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10 days in Chile - suggestions?

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Working on an itinerary for about a 10 day trip at the end of December and early January with my wife and 3 teen age daughters, who are all good and experienced travelers. My wife especially wants to see penguins and glaciers and the kids have never been to a part of the world that looks like southern Chile, so they'll be up for that, too. From reading, it seems that interesting places would be Santiago, Valparaiso, possibly Puerto Montt and Chiloe and definitely Punto Arenas, Puerto Natales and Torres del Paine. Any suggestions for lodging would be great, as well as suggestions for things to do in Torres del Paine (tours/groups, best hikes, etc.) and any miscellaneous essentials for the latter, including car rental. We are prepared to travel around, but want to make sure our stops are effective as opposed to spending too much time traveling from point to point and trying to do too much. As for lodging, we'd be fine with something nice (decent, not cheap or high end) and safe. Thanks in advance!

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