Hi Ellen,
I am SOOO jealous! Bali is one of my favorite places on earth.
My first trip to Bali was several years ago when I had the chance to stay at 15 different resorts and hotels over a period of three weeks. Its hard to find a bad place to stay, but as with all kinds of travel, what you might like depends greatly on your expectations. Staying in Ubud, I would expect you'll find a very exotic place, with a gorgeous view and a gracious staff for well less than $100 a night. You can find small boutique hotels for much less.
I also stayed at Alam Indah for several days the last time I was there. Very romantic if you're with some deserving guy, but no restaurant on site and kind of far from town by car because the roads are kind of round-about. If you feel like walking you can cut through the Monkey Forest, but I might look for something closer to town or right in town if you want to be in the center of all the activity and don't mind a little noise. Call Bunnie (pronounced Boonie) from IndonesiaPromo.com. She arranged all my plans for Indo and I've referred many people to her in the past. All have come back with great reports. Call me if you need more info. She's Indonesian, but her company is in San Jose, CA. She's got some of the best prices I've seen anywhere and is very well connected in Bali.
For topside attractions...I know from Cozumel that you like SHOPPING!! Do you need me to come and help you negotiate??? You'll find a lot of it there. The Indonesian word for "expensive" is "mahal". In only a couple of days you won't have nearly enough time to get into the real shopping opportunities, but don't miss the market in Ubud, the jewelry factories in Celuk and the wood carvers in Mas.
You'll also see many village celebrations. This is worth stopping and photographing. Very colorful and charming. If you get a chance go see a traditional dance performance, that's also great for taking pictures. I went to an Indonesian wedding and a Balinese cremation, which I would highly recommend if you're into the culture.
I also visited as many temples as I could find. Tanah Lot and Uluwatu are both breathtaking. You can visit Ulun Danu, but it takes a whole day to get up the mountain and back. Not a boring ride. Its through some of the most gorgeous rice terraces in Bali.
Did I mention the shopping? Don't rely on the cargo companies to ship stuff back to the US for you. Its very expensive and is a huge hassle once things arrive in the US three months later. Not worth it (I still have scars). Pay the excess baggage fees to get your stuff home and you're still getting a great deal on whatever you buy.
Of course you'll also need to get a massage! I can recommend at least 10 different massage parlors, cuz I got one every other day. They are very inexpensive and the surroundings are very exotic.
You can also go river rafting in Ubud. I would do that again in a heartbeat.
What you will enjoy the most is the absolutely gorgeous Balinese people. The women are lovely and exotic and the men are tall, have big brown eyes and a beautiful white smile (and love American women). Everywhere you go you will hear the Javanese music and smell the incense in the burning offerings. You will never forget the experience and Bali will no doubt leave an impression in your heart that will lure you back.
Yes, I did inhale the smoke of the clove cigarettes of those Balinese men on the beach that practice black magic and this is probably why I'm rambling.
Call me if you need any contacts once you arrive. I have friends there that will be happy to take you under their wing and show you around.
Bonnie