Yes, our experience is that the better the value (read: cheapest in class of accommodation) the less likely your guests will be thoroughly happy. You'll tend attract those whose primary interest is cheapness, but they'll have plenty to say about how spartan it is (because at that price, it's really all you can afford to deliver).
Still, there has to be some value in your offerings. For example, it's equally dangerous to deliver a spartan, basic accommodation with bad beds and few, poorly maintained amenities, while charging a premium price. This will hurt you.
IMO, the best balance is to deliver a clean, well maintained and organised accommodation with lots of comforts, at a slightly higher price than your most similar competition , no matter your location. This way, you tend to weed out the price pirates (who will never be happy with anything) while attracting a better quality of guest, which leads to fewer frustrations. It's not easy, it takes time, but once you establish it, things get easier.