Read this overiew of Venice's confusing layout, and maybe you'll be a little less perplexed when you arrive.

City Layout

With more than 100 canals and 400 footbridges, Venice is made up of 118 small islands. Snaking down and slicing through the city like a backward "S" is the Canal Grande, along which vaporetti (water buses) move the masses. The city is divided into six sestieri (sixths): Cannaregio, Castello, San Marco, Dorsoduro, San Polo, and Santa Croce. Cannaregio (northern Venice), Castello (southeastern Venice), San Marco and Dorsoduro (southern Venice) make up the edges of the city, while Santa Croce and San Polo are smack-dab in the middle.

Only three bridges cross the Canal Grande: the Rialto, the Accademia and, at the train station, the Scalzi. The centrally-located Rialto Bridge, connects San Polo to San Marco, while the southern-most Accademia Bridge connects Dorsoduro to San Marco and Castello. You'll be spending most of your time exploring the major sights of San Marco. 

Hostel Overview

Venezia may have deep canals but cheap beds are few and far between. This isn't a problem for day-trippers but if you intend to stay overnight, plan your stay way in advance. Married folks always have the option of sleeping with the nuns, as religious institutions offer plenty of beds (but you must be married and early-to-bed!)