Café Vergara, Calle de Vergara
An elegant choice, whose decor borders on kitsch and whose food looks very tempting. This is the first place I went to with a reasonable spot to sit in the corner at the end of the bar, which is handy for watching what is going on, such as long extended lunches, and lots of cake. This might be somewhere to come back for food, but they lose points because menu includes tourist-friendly English translations. Still, that's what you get for this location.