Prompted by a friend who asked me for some "suggestions" for an upcoming trip to Italy, I sat down to jot a few notes and this was the result. 

Alright, you've never been to Italy, so, my highlights:

Cinque Terre- that's the 5 little fishing villages on the cliffs that I've hiked between 3 times now, gorgeous, a one-day trip (or it could be longer if you want to do some of the less popular, much longer hikes, but I don't know much about them yet)

Vernazza - the 2nd most northern of the 5 fishing towns

Tuscany- Florence is on most people's must-see list, but unless you are dead-set on seeing Michelangelo's David in the Galleria dell'Academia, or the famous paintings in the Uffizi (I still haven't been in there- the lines are usually 3 hours long to get in without a reservation and those are expensive), I'd say it can be skipped in favor of smaller Tuscan towns and villages.  And of course if you're traveling by train, you'll probably pass through Florence and can schedule in a few hours to look around.  The smaller towns, I'd recommend are Lucca (so picturesque, not so touristy, good options for biking around in the country, etc), Pisa- but just to see the tower, then skedaddle! and Sienna- I haven't made it there yet (had to cancel my plans last year because they added a rehearsal) it's in between Lucca and Florence in size but still retains smaller town character because of the competition between quarters and the annual Palio (super intense horse race around the main square -actually happens twice a year- in early July and once in September). 

Lucca from the tree-topped Torre Guinigi

Venice- everybody's got to see it once.  I don't know what the hostel options are on the islands themselves, you may have to stay on the mainland, but it's connected by bus, so not a problem.  Also no idea about nightlife as I've only spent the night in the city with my mom and sister... but it's beautiful and the best sight-seeing trick is to buy a ticket (they usually don't check but it's good to have one to play dumb with later if necessary) and take the Number 1 Vaporetto (like a city bus, but it's a boat) from Piazzale Roma (where the buses drop you off from the mainland) all the way down the Grand Canal to the Giardini stop (very far from the tourist madness that you'll find in the middle of the city).  Then spend the rest of the day wandering through all the twisting alleyways back toward Piazza San Marco and all the famous sights in the middle of the city.  That way you get the awesome views from the water, and don't hop on and off the 'buses' all day, and the back streets and tiny bridges are what make Venice so special anyway.  At the Giardini stop is the only real park on the islands, and every other year (odd numbered years) it is the site of the Venice Biennale, an international art exhibition in which tens of countries are represented, each in a separate building in different styles of architecture, on the off years however, the place has a very eery feel and you can wander around as you like for free. 

As for the main sites, don't miss Piazza San Marco and the Rialto bridge.  There is also a Guggenheim museum and some others that I would have been interested in visiting but my sister doesn't "do" museums.  I suggest going inside the St. Mark's cathedral, even if all the Italian churches start to look alike after a while, if only because of the role that church played in the history of our instruments (Gabrieli wrote all his brass works for the services there) and it's free to get in, but to see certain parts you must pay. I'd skip everything but the option to the right as you go in- it leads up to the facade of the church which gives you a fantastic view of the Square and across the Grand Canal and a very up close and personal meeting with the 4 famous horses.  Behind the facade is a small museum and that was a nice little bonus. 

Venetian side street

Rome-  You can't see Rome in a day, but if you are absolutely crazy, and have an Italian with you, you can see it in two :)  Don't miss the Coloseum, and the Roman Forum ruins next to it.  I didn't get the audio guide about the Forum, even though some friends had said it was the best decision they made in Rome, and later regretted it.  Eat pizza and Spaghetti Arrabiata, and don't you dare sit down at a restaurant before 9pm.  The Romans eat late- 9 is on the early side.  Walk by the Spanish steps and the Trevi fountain, and check out some of the ritziest shops in the world along the Via Condotti (excellent people watching).  Do not miss the Pantheon.  Incredible.  Go to the Vatican and into St. Peter's Basilica (Sunday afternoons are a good bet because it was absolutely packed in the morning and then clears out incredibly) but have enough time to explore the gardens and everything behind the basilica- I didn't have time :(  After exploring the Vatican, try to find the restaurant Ristorante "La Vitoria" Pizzeria on Via della Fornaci off the south side of St Peter's Square- one of the best meals of my life.  And I just found the name of the restaurant by finding it on googlemap's street view... since I remembered seeing the name on the awning!  Isn't technology amazing????

Naples- skip it and stay a little further down the coast, or find a great deal on a hostel and stay there because then it's easily connected to Capri- most beautiful place on earth (outside of Gimmelwald, Switzerland) and Pompeii/Vesuvius.  Barbara and I went to Pompeii and then got on a bus tour that took us to Vesuvius where we could walk around the crater at the top of the volcano- go all the way to the end (you can't make a full loop) and buy a glass of local wine :)  The bus tour takes you back to Pompeii where you should definitely go around the ruins and this time get the audio guide- totally worth it.  The ruins are absolutely huge -it's a complete city afterall- and the guide was incredibly interesting (don't miss the brothel with stone beds (and pillows) and paintings still visible suggesting interesting positions for the customers to try!) 

Tasting local wine on Mt. Vesuvius

Capri- like I said before, one of THE most beautiful places in the world. Stunning natural beauty and cute architecture/gardens/etc.  The best value I found on the island was right in the Marina where the ferry drops you off, are all sorts of options for tours of the island and boat rentals, there's a stand to the left as you are walking along the dock nearing the actual land, that has a 2 hour boat tour around the whole island.  The boats took only 15 or so people so everyone has a great view and it's not crowded and the guide pointed out all the interesting things (come to think of it, I cannot remember if the tour was in English, I believe it was only in Italian, but bring a guidbook and look up the things as he points to them, or ask someone else).  The tour was 14€ per person.  (not bad for two hours considering a gelato in the main square in the town of Capri- Piazza Umberto I-also where the movie stars hang out- was 7.50€!).  Near the end of the boat tour you are taken to the Blue Grotto (Grotto Azzurr in the northwest of the island where, should you wish- and you will! - you can transfer to little row boats in groups of 2-4, where local Italians will row you through this tiny opening in the rocks into the grotto (you actually need to lie down in the rowboat to get into the cave)- it's incredible.  It costs about 10€ extra, but it's worth it- the color of the water is absolutely stunning and the acoustics are impressive too. 

Back in the Marina, take the funicular up to the town of Capri and walk all over, marveling at the prices of the restaurants- 120€ for a lobster dinner anyone?  40€ caprese appetizer? - and the fancy shops and the kind of people who can afford it... I wish I'd had more time to explore and someday I'll find a way to go back.  I had heard that there were no hostels on the island, but I just checked and it lists a few places, certainly cheaper than any that I ran across while walking around.

Capri - inside the Grotto Azzurro

As for the other places I've visited in between those above:

Viareggio/Darsena in Tuscany is nice if you want to spend the day at the beach (Darsena is the free part and you'd probably never find it without detailed instructions, so if you're interested, ask me) but if you head to Cinque Terre and/or Capri, it's not worth a whole day.

Bologna isn't bad, but it doesn't have the same amount of must-sees as the other major cities in my list, however it is somewhat of a food mecca.  Just be sure not to get on the bus in the wrong direction... oops. 

Montecatini in Tuscany has baths which I was excited to try, but when I tried to figure out how to visit them it seemed they catered more to the elderly and people searching for "cures," unlike the baths in Hungary and Germany, where perfectly healthy people go to stay that way and enjoy the water.

I haven't been south of Pompeii, but on my future visit list is the Amalfi coast (quite near to Pompeii, but on the other side of the peninsula) and Sicily.  I also want to hit the islands of Elba, Corsica, and Sardinia. But they wouldn't really fit in a grand tour- because ferries take a long time.

So!   There are my recommendations in a nutshell.  I can suggest some hostels and cheaper hotels if you're interested, and give more tips on where to eat (where the best gelato is) and how to get around, but I'll save that for later.  Enjoy!