Cornflake, I agree. I wouldn't stay in NJ either. LIC is on the subway line and could be an affordable way to stay and commute to the city. It is very close and wouldn't be a real time constraint. (Assuming they would have a 7-day metro card, cost wouldn't be an issue either)
I equate it with staying in crystal City in VA on the metro line and visiting DC. Still doable IF the cost of the hotel offsets the cost of travel.
I have done both and Crystal City is a lot closer/easier commute to DC (right next door) than NJ is to Manhattan. Personally, I would save up and stay in Midtown. It is much easier to get to the main tourist spots.