short of
1) only going to places within driving distance
and
2) only going to places where you have friends nearby
i dont think it can be made too much cheaper.
there are certain things:
(1) Getting there - some places you have to fly, but if you CAN spend say 8 hrs on a train, it will be cheaper and land you in the same spot (probably cut the cost in half) ... im talking going down the east coast or something like that. also, try and make plane reservations around 3 wks in advance. for the most part, there isnt much reason to spend more than $300 on a round trip plane ticket nowadays unless youre really desperate and doing it last minute. otherwise, you should be able to find a pretty good rate (though it may involve a stop along the way).
(2) Staying there - if you have friends there, that's ideal. but the best bet isn't always a hotel. there are hostels, many of which are not that bad, and are much cheaper. you can get a night in a hostel in most major cities and most are located close to major transportation (subways, etc.)
(3) Getting around there - get a shuttle. taxis stink and are really expensive. call ahead of time if you know when youre getting there and find out where you can pick up the shuttle (or where the shuttle will pick you up) and how much. sometimes, especially in places that dont have shuttles, renting a car could be the best option ... just look up maps on google earth and mapquest and print them out before you go there as it will make life easier. remember, though, that you have to park the car and that may cost $$$ and ultimately make it more expensive, so you have to know where that car is going to go. otherwise a nice shuttle back and forth may be your best option.
it just involves cost-cutting along the process to reduce total cost at the end. in the end, if youre not only applying in a small, select area, interviewing is going to cost a bunch, and it's unavoidable.