Hoi An is in the central area of Vietnam, near Da Nang and Hue. It's best to not go during the flooding season, I'm just sayin. The things to do if you are going to Hoi An are: (1) stay at one of the euro beach resorts on the beach and walk on the beach and sit by the pool; (2) have the famed tailors of Hoi An make you custom-fit clothing at low low prices; (3) enjoy Hoi An's french-colonial-slash-tropical charm.
Some activites I would further recommend: shop for art, ride a scooter, take a cooking class. I thought Hoi An was the perfect contrast to busy Hanoi and hot-and-tourism-intense Angkor, so if you're in the neighborhood, you should go there.
The beaches. Hoi An itself is on a river, but it has a sort of spit of land where all the nice beachfront hotels are. Hoi An makes a great change from hectic Hanoi or, as for us, a good antidote from heavy-duty Angkor-type tourism. The town has a bunch of hotels in the $20-$30/night range (presumably not on the beach) and a number in the $300-$500/night range (on the beach and mostly euro-owned chains). We stayed at the swiss belhotel golden sands because it was pretty much the only place in the middle (we paid around $120/night). Typhoon and floods aside, it was very nice -- beach, pool, nice room. One hint: as soon as you arrive complain that your bed is too hard (like every bed we encountered in SE asia) and ask for a featherbed/pad thing; a crack team will come to your room and install it like marines field-stripping an M-16 and you will sleep marginally better.

The clothes. People who are properly prepared for Hoi An do things like buy fabrics in Thailand or wherever and bring pieces of clothing they want copied or photos from magazines. We did none of this, but still had fun getting clothes. Basically you go into a tailors, pick out some stuff you'd like from their examples, choose fabrics and styling details, get measured, then come back in a day for fittings. If necessary, alterations are made, and you eventually walk out with your very own custom-tailored clothing. I got a nice suit, a wool coat, and a couple of shirts, all for about $150. My advice is: on your first day, go to a few different tailors and order a few items; if you really like one place, order more there later. At first, decide ahead of time what you're going to order -- it's way too easy to get caught up and think you'll order just one more shirt or dress or whatever. Don't overdo it: yes it's cheap and fast, but you'll probably need to go through fitting and alterations for most pieces, and you can easily get tired of the whole thing. It's fun if you keep it low key and get some things you wouldn't have chosen otherwise, like a suit with a mandarin collar (my choice) or a dramatic red dress (E's).

Hoi An is very picturesque, with its waterfront and small streets full of mossy, dilapidated french-colonial houses. There's a busy market in the center of town, and lots of shops, and restaurants, as well as some old temples and restored houses to look at. You will probably get more photos of picturesque boats and houses than you know what to do with. As with Hanoi, there are plenty of crappy fake art galleries, but there is some real art too. Local artist Hoang Trong Tien has a gallery (on Tran Phu just west of Le Loi) -- we had a great time talking to him about his art, the town, and the floods, and bought a couple of pieces from him. You save a lot of money and have a much better time buying directly from him, though you can find his stuff at other galleries and online.

There's a local cuisine of Hoi An, and you'll see certain dishes everywhere, including a special version of Pho and a pancake thing with bean sprouts and green onions. We had our first la lot leaf sighting in Hoi An (at the mermaid cafe on Tran Phu by the market). We also did a cooking school; it was sort of silly but fun, and at $16 apiece, well worth it. It started with a tour of the market, including pointing out interesting local fruits and vegetables. Then there was a cooking demonstration at the red bridge restaurant (which is at a beautiful secluded spot on the river) where we got to practice a few techniques, followed by lunch where we ate the dishes we'd just learned about. We got a packet of recipes to take home and did learn a few things, the best being how to make fresh rice paper, which is far better than the dried ones you buy and have to soften up in water.

Hoi An was also where we rode our first scooters. You see them everywhere, but in Hanoi we mostly got around on foot, and in Siem Reap we'd had a car and driver for visiting the temples (and took tuk-tuks into town from the hotel). I rode my first scooter when I asked our tailor where I could find some cough medicine. She said the ones in town were all closed due to the flooding but offered to take me to another nearby, and we hopped on her scooter. I'd been a little afraid of the apparent chaos, but once on a scooter I thought it was awesome. After that, we always took them from our hotel into town instead of taxis. They don't go particularly fast, and you don't feel in any danger of falling off, and it's much more fun to be cruising along with the wind in your hair and so on. Plus, it's cheaper than a taxi. E and I are trying to come up with reasons why we need scooters now -- though I think on american roads surrounded by american drivers, I'd feel much less safe.