7 days in Madrid area

I've not visited Avila or Segovia yet, but we enjoyed staying in Toledo for a few nights.
I'd suggest spending at least a couple of nights in Toledo so you can enjoy it's peaceful atmosphere without the crowds that descend on the city every mid morning.

You definitely do not need a car to travel from Madrid to Toledo as it's an easy 30 minute train ride.
You can also travel to Segovia & Avila via train.

You mentioned that you have 7 days, is that 8 nights or 7 nights?

Segovia is a day trip. Toledo is overrun during the day, wonderful at night, so stay the night. Use trains, fast and easy. Get a guide for both places if you can, it will add to your experience. The suckling pig in Segovia is not to be missed. Here is where we had lunch with our RS tour group: http://www.restaurantejosemaria.com.

To me, Avila is not nearly as interesting as Toledo and Segovia. It's a perfectly OK destination (at some altitude, so will be chillier in March), but I recommend reading about Cuenca before you make a final decision. Cuenca's less than an hour from Madrid via the AVE train. You will need to take a taxi or a bus from the AVE station to the old town, however.

Although I found the most to do in Toledo, both Segovia and Cuenca are worth overnight stays if you have the time--which you might if you're not much interested in the three major art museums in Madrid. But one of the main points of interest in Cuenca--aside from the old town in general and the picturesque hanging houses along the ravine--is its two not-large modern-art museums, so...

I'll join the chorus - spend a couple nights in Toledo. My suggestion would be to go to Toledo directly from the airport (change trains at Atocha station) for 2 nights, then spend the rest of the time in Madrid. Of course that would depend on your flight schedule. It's easier to get to Toledo during the day if you land in the morning or early afternoon. It's easier to get back to the airport from Madrid, especially if you have a morning flight out.

In Madrid, staying near a Cercanias (suburban train) station will make those day trips easier. In Madrid, consider visiting the Naval Museum (it's a block or two from the Prado) and very interesting (take passports for admission).

Thanks to all your thoughts. I believe the plan is to stay 4 nights first in Madrid because we are suppose to get in mid afternoon and I don't want to take the chance of flight delays trying to get to Toledo. During the 4 days do a day trip to Segovia and then 2 nights in Toledo with a return late in the afternoon of our last night to a hotel near the airport for a very early departure back to Colorado.

I'd schedule just one night in Toledo, but be clever with my train times.

Day 1 - Arrive Madrid (3 nights)
Day 2 - Madrid main sights
(Royal Palace, Plaza Mayor, Puerta del Sol, Plaza Cibeles, Puerta del Alcala, Retiro Park)
Day 3 - Day trip to Segovia
Day 4 - Early train to Toledo (1 night)
Day 5 - Late train to Madrid (3 nights)
Day 6 - Madrid museums
(Prado, Thyssen, Reina Sofia)
Day 7 - Day trip to Avila or Salamanca or Cuenca
Day 8 - Depart Madrid

Now you have me wondering....renting a car for 2/3 days at airport and drive to Toledo then head to Avila and Segovia. At the end drop my family off at hotel and return car at airport. So kind of make a circle from Toledo, Avila and Segovia. Thoughts?

Use ViaMichelin to estimate driving times and compare to train schedules. You may run into parking challenges, and you'll spend time picking up the car, refueling and dropping off the car. I suspect that you won't really save time, but I could be mistaken. The train is definitely faster to Toledo.

Again thanks for all of your thoughts and information. Another question....Looking at staying in one of the Petit Palace Hotels east of Prado and/or in Salamanca area. Petite Art Gallery, Savoy Alfonso and Lealtad all look very nice. Has anyone stayed in these hotels or areas. I have read it sounds like it is a lot quieter but is it difficult to get transportation from here to Sol and Plaza Mayor area?

I just got back from the Madrid/Barcelona tour. We had a day trip to Toledo, one of the things I may have changed was actually spending the night there. Very nice town.

Federico was our tour leader and our guide for sites in Madrid, he is mentioned in the book. He was excellent, loved his stories about Madrid, art and all of his acting skills. He made the art come alive.

Adolfo was our guide in Toledo, also excellent.

I like having guides, it takes some of the guess work out of it and also gives you someone else's perspective. I have a whole new appreciation for Picasso's cubism stage.

In Madrid, we stayed in H10 Gran Via hotel. It is very close to Puerta del Sol and convenient to Plaza Mayor and all the other sights. A very nice hotel, would stay there again.

Mary

I'm sure that caliber of hotel would be happy to call a taxi for you, but if you're interested in public transportation:

I checked this out on Google maps since I haven't been around to the back side of the Prado. From the Art Gallery you'd have about a 1/4 mile (5-minute) walk to the Retiro Metro station, from which you'd take Line 2 to Sol. You'd then have another 5-minute walk on to Plaza Mayor.

Staying at the Savoy Alfonso would give you a slightly longer walk to Retiro Metro (closer to 1/3 mile), but if you chose to walk all the way you'd be quite a bit closer to Sol and Plaza Mayor.

The Lealtad would mean a longer walk to the Metro (about 0.4 miles), and you'd want the Banco d'Espana Station. But your all-the-way walk to Plaza Mayor would now take only 20 minutes (not by way of that Metro station).

I imagine all three hotels are in nice areas, but in your shoes I'd want to know about neighborhood food options. Remember that Spaniards eat very, very late. When I'm tired I prefer to eat reasonably near my hotel. You can go to maps.google.com, type in the name of one of the hotels and Madrid. When the map appears, click on "Nearby" under the blue banner and choose "Restaurants Nearby". I've linked to a map showing the Lealtad. Some restaurants are marked with knife-and-fork; others, with just a small red dot.

You can also switch to Google's Earth view. I see a lot of trees around the Lealtad.

Having a car is of no particular benefit whilst in any of the 3 places - Toledo, Segovia, Avila.
And when it comes to getting to all 3 places, a car has no advantage over taking the train.
When you throw in potential issues with parking and navigating in historic town centres and I would lean towards utilising public transport.

Again thanks for all comments. Wow I use google map here in Denver but didn't think about it for Madrid. East off Prada seems to be void of cafes and markets. That would be a problem for us in the evening. Now after looking at locations were are considering Liabeny, Pasoda de ord and Petit art gallery. All have advantages and disadvantages but all look good unless someone has another gem of a hotel. Also thanks for comments about car. So right that don't need one when train will be convenient. So now we believe 5 days in Madrid with a day trip to Segovia, early train to Toledo for 6th night. Come back to city late afternoon for 7th night somewhere close to airport for early morning flight out. Thanks again to all comments.