Fabuloso
Hermoso
Stayed here for a week in March 2013. Food, accomodation, and especially dive service are excellent. However if the whale sharks are not in the next island East (Roatan) is better diving.
This place is amazing not so much the Laguna Beach Resort, although that too is quite nice, but Im speaking more about Utila here.
It is a tiny island that is still very authentic to its fishing village roots. There are only some several thousands native inhabitants of the island, while the majority of its denizens are students traveling around and stopping here to become dive masters and generally have a fun, low key experience. The scuba diving and fishing are amazing. Whale sharks, turtles, seahorses, everything. It might be a little rustic for those who are used to finer accommodations, but for me, this place struck a great balance between authentic and still relatable. Now, the resort is a bit of a ways from town and any semblance of activity, but, since the island is so small that isnt much of a problem.