We stayed in the beautiful Picasso room and it was nothing short of perfect for the 5 nights we were in Madrid, from Dec 26/13 to Jan 1/14. It had more than enough space for two and the location is awesome especially if you want to be in Plaza Sol for NYE. We only took the metro once (to the zoo) as everything is in walking distance. Noise outside was loud but likely due to it being a holiday week.
Marga is a great host, even sent over a hair dryer when I requested one as I had forgotten mine. If you are traveling with a larger group, she also has other suites that all share a main entry but you have the privacy of your own suite.
This is my first airbnb experience and it made me wish I booked the rest of our Spain trip through airbnb instead of hotels!