Think Cuba and one usually thinks of Che, Fidel, mojitos, cigars, salsa and fantastic beaches. A vacation to Cuba is normally either an all inclusive package to one of the heavily controlled Caribbean beach resorts, or a more adventurous overland tour exploring Cuba's colonial heritage and communist present. I'd definately recommend the latter.
Varadero and Cuba's Beach Resorts
Varadero is Cuba's largest beach resort - the beaches are fantastic, tourism is heavily controlled and hotels are almost always all inclusive resorts. To many vacation makers, Varadero is ideal if they simply want to relax on a beach for a week. There are numerous other resorts on Cuba's Cayes that are similar in style to Varadero. Those seeking a less resort type vacation might want to consider more laid back beach destinations such as Cayo Levisa or Cayo Santa Maria, two places that at the moment aren't overrun by mass tourism and large resorts.
Mainland Cuba Tours
To simply holiday to an all inclusive beach resort such as those in Varadero is to miss what Cuba is all about. The capital city, Havana, is worthy of 3 or more nights, ideally in a hotel in the old town which makes a great base for exploring this fascinating colonial city. Two hours to the west of Havana is Vinales - this is cigar growing country with strangely-shaped rock monoliths, and an excellent base for taking in Cuban culture, in addition to horseback riding or hiking in the splendid verdant valleys. Four hours East of Havana lies Trinidad, Cuba's prettiest colonial city. Trinidad also has great beaches nearby, so those on vacation have the best of both worlds in terms of beaches and culture.
A note on responsible travel to Cuba
Cuba is a totalitarian and repressive state. It's citizens have few rights, and are currently not allowed to travel abroad. By staying in government owned resorts (most of the hotels and resorts in Cuba are owned by the government) you're helping to prop up an oppressive, human rights abusing regime.
My advice if you do travel to Cuba, would be to do so responsibly - and one of the most responsible ways to visit Cuba is to stay in Casa Particulares on your travels - these are family homes that have been converted to accommodate tourists. By booking such Casa Particulares your money is not going straight into the hands of an oppressive regime that undoubtdely needs to be changed. By booking an all inclusive package holiday, you're invariably contributing to the governments coffers. Travel responsibly - leave your money with the locals, not the local regime.