I just got back last weekend and we found a pretty nice duplex for 1600 for a week. While we were there though we meet the neighbor who had a more modern and bigger place that he would rent for 1400 and siad you could rent just the downstairs apartment (1bed 1 bath) for 700. It's in Key Colony Beach which is basically Marathon. Let me know if your interested and I can pm you his contact info.
Honestly it doesn't matter where you stay, its the Keys, everywhere is fun!