An independent traveler's mecca, Dali is one of my favorite places in China.
Flanked by the Cangshan mountains and Erhai Lake, the city is divided into Dali New City (Xiaguan) and Dali Old Town (Gucheng). With good hiking options in the mountains and small minority villages along the lake, Dali offers a gamut of activities to choose from.
We'll spend a day hiking the Cangshan mountains (with or without taking the cable car to the starting point) for some stellar views of the town and Erhai lake. After a tiring but fulfilling day, we head to Yi Rang Tang in Dali Old Town for a scrumptious veggie buffet prepared by Buddhist monks. It is all-you-can-eat for less than a dollar, but the bowl has to be licked clean. No wastage whatsoever. We finish the day sauntering around the old town hitting a few bars if we feel like it.
Another popular activity is renting bicycles and riding the circuit around the Erhai Lake while stopping at some of the minority villages and interacting with the locals. The weather was not in my favor the last time with incessant rain, but it still made for some memorable moments enough to make me come back.