What is there to do on Coronado Island?
 

Should we visit it for a half day/dinner? (We are staying in LaJolla for a week).

You could spend a full day. Shops, old houses, wonderful beach, explore the Hotel Del, watch the jets fly over. If you're lucky, an aircraft carrier might be in the area for viewing and they are truly amazing. (Although since we are at war I doubt they are offering tours at this time.) We usually stay with frinds who live there, so I'm not one to give restaurant advice... I just enjoy Coronado, even just driving over the bridge is fun and beautiful!

also, you can rent bicycles or little surreys and cruise around the island. It is a very bike friendly place and every street has cute houses. you can take a passenger ferry from/to the San Diego side (near the Star of india) to have a nice ride and tour of the harbour for only a couple of dollars

The Golf course on Coronado is a nice one- and quite affordable, too.

It's worth visiting Coronado to tour the Del hotel. The shops are OK if that's your thing, but they are better in La Jolla.
The beach at the Del and down the Silver Strand is fantastic.
Unless you're going to lie on the beach, you can do Coronado in a few hours.
If you are there at lunch, there is a good Mexican restaurant across the street from the Del called Miguel's Cocina.
If you are there at dinner, Il Fornaio, a moderately priced Italian restaurant, offers a great view across the bay toward downtown.
However, as with the shopping, there are better restaurants in and around La Jolla.