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Have a favorite hotel or B & B in the Algarve?

I'm beginning to plan a 3 week trip in May which begins with a return visit to Sevilla and proceeds with about two weeks in Portugal; our first stop-TBD- in Portugal will be in the Algarve. In my experience, we all have memorable places we dream of returning to (in our case, Lake Como, Bruges, Istanbul come to mind) as well as wonderful hotels we've enjoyed. Is there one in the Algarve you'd recommend??
DH and I are in our early 60's and love small places with personality, great service, charming décor and good food - and we love beautiful, non-touristy beaches. Not interested in night life or bars, but in handicraft shopping, cafes and informal restaurants, scenery.
Any suggestions you have for elsewhere in Portugal also welcomed (just booked a place in Evora that a couple we ran into in Budapest last month raved about!)...thanks, Forum-ites.

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