Hotel Matilda, San Miguel de Allende

The climate and amenities of San Miguel are fantastic. If you can, reserve suites 10 or 11 at the Vila Jacaranda and you'll have no regrets. I must have stayed there a dozen times and always loved the views from the rooftop, the peaceful environment, an outstanding breakfast, proximity to an interesting park (home to hundreds of egrets), a five minute walk from the square and La Capilla restaurant that offers world-class entrees (duck is better than anywhere else I have dined). If you want something more lively, Mama Mia is a couple of streets away and has a great resident band. If you have time, rent a car and visit Queretaro and/or Guanajuato. They're each less than an hour away, and like San Miguel have surprises around every corner. Incidentally, I was there many times between 2003 and 2006 and never encountered any problem on the streets at any time, day or night (some nights I would shoot pool with the locals at an Argentinian bar and only get back to the hotel at 2 a.m. Had to wakes the concierge up though....he'll be glad I'm not there nowadays).