We stayed at the Montevideo Sheraton last year - great spot, and pretty cheap too.
We spent a day in Colonia and yes it really is an historic sleepy place. I'd be surprised if there is enough toursit overnight traffic to justify the 4 or 5 star hotel?
The ferry that takes you across to the centre of Buenos Aires has THEEEEEE cheapest booze I have ever seen. It runs EZE-MVD AFAIK so Colonia is just a pick up spot.
IIRC 2
litres of Scotch ran about $US10 total.
We are back in EZE in a couple months and were tempeted to make the trip again.
As a trivia point the United EZE-MVD flight is THE shortest "It'l" flight they make worldwide. A 777 with 10 or whatever pax was pretty weird! Even in C there was not time for even one drink.
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Don't forget the FT Party In Paradise 'PiP' Hana Hou - in HNL Oct 25-27