What to do and where to stay in Mykonos, Greece?

I am planning a trip to Mykonos this August and I would appreciate any information or tips about what to see there and where to stay.

Response:

We stayed at a place a little up the hill – but very easy commute – to Mykonos center. the name of the place is Hotel Jason and I have provided some links below where you can read additional reviews check pricing. We did find Mykonos to be a little more expensive than some of the other islands (not terribly, just a little more). Book ahead because August is busy. We went in late September and there were not a lot of rooms available on the island.
If you are going to be there a while, I might recommend you also travel to and stay at some of the other islands within a couple hour ferry ride away, or even further. For example; Paros and it’s little neighbor Antiparos is not far away and nice. This would also be approximately a half way point if you then wanted to continue on to the famous Santorini.

http://www.tripadvisor.com/Hotel_Review-g189430-d309918-Reviews-Hotel_Jason-Mykonos_Cyclades.html
www.hostelbookers.com
www.hostelworld.com

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