When I started touring as a college student, I used the hostels on and near to Cape Cod quite a bit. It was an easy two day ride from Boston to the Cape before taking the ferry back. As a result, AYH (become HI) is one of two organizations I have a life membership. Adventure Cycling it the other.
At that point, the hostels on the Cape were particularly popular - and more so than others I tried elsewhere in New England (e.g. East Bridgewater MA and one in NH and others). There were groups from greater NYC area that organized youth programs where a group of teenagers with one or two adult leaders would go bicycling for a week on the Cape and stay at different hostels. This made them sometimes noisy chaotic places. However, an inexpensive place to stay and requiring only a sleep sack it worked for basic touring.
I've stayed in hostels in later tours in Europe, Australia and New Zealand - however, now have a preference for even an inexpensive motel or camping in my tube tent - where I can do this.