CO FF

Edited 1/23/12: [SEE POST 18 FOR UPDATED ITINERARY BASED ON COMMENTS IN POSTS 2-17!]

I've got a 13 day Peru trip coming up in late June-early July. The JFK-LIM-CUZ and PEM-CUZ-LIM-JFK-LAX flights are ticketed (AA award); I would appreciate input, esp. answers to the questions listed below:

Day 1 - arrive LIM from JFK; LIM-CUZ. Stay at Tambo del Inka (SPG award)
Day 2 - nothing major planned, to acclimate to altitude. If doing ok, see Sacred Valley sites.
Day 3 (Sunday) - Pisac Market; Inti Raymi (sun festival); other local (non-MP) sites
Day 4 - Macchu Pichu
Day 5 - Other Cusco-area sites
Day 6 - to Lake Titicaca [3:15pm nonstop flight]
Day 7 - at Lake Titicaca
Day 8 - to Arequipa [9am nonstop flight]
Day 9 - Arequipa
Day 10 - Valley of the Condors (AM); possibly fly to LIM on return from condor spotting
Day 11 - to Puerto Maldonado [either from AQP or LIM]
Day 12 - Lodge experience
Day 13 - leave P.Maldonado on mid-day flight to Lima (check luggage thru to LAX if possible); on arrival in LIM, leave airport for a rushed tour thru Lima, including nice dinner, before returning to LIM for 12:20am(+1) flight to US.

So, here are my questions:

1) Am I spending too much time in Urubamba and the whole Cusco area? I know I need a full day for MP (we're in our late 40s, so a 3-4 day hike of the Inca Trail is not really our thing), but do we need 3+ days for the rest of the Cusco area?

2) Suggestions are welcome for a place to stay at Lake Titicaca.

3) Suggestions are welcome for a lodge near Puerto Maldonado. We don't want to go "over the top" on the eco-stuff, and only have 2 nights there.

4) For Arequipa, we want to stay in a (nice - US 3.5-4 star level) hotel that is within walking distance of all the historical sites in the center of the city. In some of my reading, I saw a comment that the walk from Casa Arequipa to the Plaza de Armas/Santa Catalina area might not be the safest at night. Any feedback?

Thanks in advance...