I vote for Quebec City.I am from the middle of the USA and found Montreal to be less interesting then Quebec but as Linda said,you can see both cities in a short time. I also hope you can find a way to stay at the Chateau Frontenac,we found a discount by using rail/drive hotel reservations with canadian trains even though we drove the whole time.Definitely look at all avenues for discounts.But,having said that there are other small hotels in the old part of the city that may be cheaper,I feel you do want to stay in the old part of Quebec City.Enjoy,I figure the people from Canada can give more sound advise.

Wilma from rainy K.C.