Tiny penguins rule the roost in this historic settlement nestled in the heart of an ancient volcano. With a balmy, year-round climate, these famous foot-tall residents are certainly not snowbirds. The spectacular surroundings offer a wealth of outdoor activities, both in the sheltered harbor and on dry land. Cafes open onto streets and exquisite local boutiques and galleries offer superb local works. Be sure to sample the fine fudge and traditional cheeses.