I think the south of the lake is very pretty. Peschiera is also on the train line & is very quaint. Near to Serimone, which is lovely (but very touristy). Prices will depend when you go, but I generally find hotels in Italy to be abit on the expensive side & not always to the same standard as we have now (think of Ireland about 15 years ago). 2 nights is probably too short to look into the option of an apartment which would probably be cheaper.
Venice is a must see but 1 day was enough for us....rather tatty and very busy with tourists. 1 night stay (so 2 days visiting) would certainly mean you see all the main sights....if you're going budget, don't even think about coffee on St Marks Sq. But you will get very reasonable places to eat just off the main tourist trails.
just to let you know a small thing about the trains in Italy - you must validate the ticket at the platform (yellow box) or you will be fined (loads of inspectors & they don't listen to any excuse).
Enjoy - the italians are lovely so I'm sure you will have a great holiday