Dennis: Yes, avoiding expensive hotel cities is a way to contain travel costs. Of course, the obvious tradeoff or downside to that strategy is that you don't get to spend much time in Rome, London, or Paris, if you don't sleep there. In those 3 cities, the suburbs are distant from the city center, which means greater transportation cost and time to commute from the suburbs to the city center where the goodies are, every day. And some travelers have found that lodging cost is not significantly reduced in Paris by sleeping in the suburbs.
Single occupancy hotel rates are not even close to half of what double occupancy rates are; in some cases they are closer to the double occupancy rate.
Re total daily cost, there isn't much good data out there. Rick's book Europe Through the Back Door 2009 has a budget/trip cost chapter, in it he gives a figure of $185/person/day, this includes everything except airfare to/from Europe--but Rick's analysis isn't apples to apples with your trip because Rick's numbers are based on a couple traveling and sharing a room (but, as said above, single occupancy hotel cost is nowhere near half of double occupancy cost).