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Cyprus in December

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We are thinking of going to Cyprus for a week around Christmas this year, possibly from 21st to 28th December.
I was wondering if anyone can help with the following questions -
1. Are the resaturants, tourist sites, shops etc likely to be open during this period?
We don't mind self-catering over the Christmas days but would like to know if the businesses will be open except those couple of days? or is it a complete shut down during that period?
2. We will rent a car. What areas would you recommend for self-catering accomodation. We don't need a resort or a spa or even a pool but would like somewhere quiet, possibly with views (mountains or sea). We don't mind driving for shops, groceries and restaurants.
3. I have been through previous posts for recommendations for sites to visit and local restaurants but a lot of them are quite old. Can anyone recommend local restaurants not to be missed?
That's all for now. I may have to come back with more questions!

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