I had a quick squizz at Wotif just to see what's around for that money, not knowing when the booking's wanted for I chose next Wednesday.
It might also depend on what the dinner plans are, but for example the Rydges on the eastern side of Central was $236 for a king double (and has Sydney Brewery under it & not far from all the Surry Hills eateries including Firedoor just behind it). I'd prolly catch the tram to there, even if it's likely 10min longer than the train.
But it looks like a clean 4-star with good reviews is certainly doable, particularly if harbour views aren't needed.