afaik there is an a&o near the main train station, never stayed there, though (haven't been to dresden in about 15 years) - in general, i'd say a&o hostels are big and impersonal, but clean enough (it kind of depends what type of hostels you like) ... so not recommending it in the proper sense, just mentioning it is there.
rikita, are there any hostel chains in Germany you'd recommend over a&o? While I do have younger friends, this is more for middle-aged and "recent seniors" (in their 60s, but you know, boho arty types).
Personally, I've never been to Berlin and hope to go there some day!
sorry, i don't really know much about hostel chains - haven't stayed in any hostel in quite a while, and back when i did it wasn't in germany, and i preferred small hostels over chains. the only reason i know a&o a little bit is because i worked for them for a few months during university ... in berlin, i think you could find nice non-chain hostels or hotels, i could look into it, though i couldn't go by my own experience of staying there ...