Most common Cusco city tour stops (in no particular order):
Cristo Blanco
Qorikancha
Saqsaywaman
Tambomachay
Puku Pukara
Quenco
church on the corner of the plaza (can't recall name)
Some restaurants I like:
PapaChos -a Gaston Acurio owned burger joint
Jacks - always busy; everything is good!
Nuna Raymi - I like the duck
Fallen Angel - IMO, the best restaurant in Cusco; the steak is great
Want to watch the local soccer team? See if there's a match at Estadio Inca Garcilaso De La Vega.
Seeking some action/adventure? Try white water rafting (cat 2-4 but mostly 2-3) on the Vilcanota River.
Regarding hotels, I haven't stayed in the hotels RCyyz mentioned, but they do get great feedback. Personally, I avoid US chains when I travel. I much prefer to see what a country has to offer. Don't get me wrong, the Hilton is nice and a safe choice, but why not try something genuinely Peruvian?