On Kauai several years ago, we stayed at Koloa Landing Cottages
(http://www.koloa-landing.com/). They are on the south side near Poipu
Beach. An older couple owns a set of apartments and houses across the street
from the beach and the Koloa Landing boat ramp. It's an excellent location
for snorkeling and shore diving!  It's not on the beach (which makes the
snorkeling better) but is within walking distance of Poipu Beach. It's near
the Sheraton resort, if that helps you locate it on a map. Lots of turtles.
You'll be able to see the state fish, the humuhumunukunukuapuaa (picasso
triggerfish), which tends to stay closer to shore than the dive sites.
They're very shy, but there are so many of them, you'll probably see one or
two before they flee the scene.

We rented a 2 bedroom house, which came fully furnished with kitchen stuff
and even wine glasses (I've stayed at some otherwise nice rentals where the
drinking glasses don't even match, much less have real wine glasses).  It
was great. Lots of room and a nice garden outside, with a lemon tree full of
ripe lemons. Sylvia, one of the owners, brought us ripe papayas from her
tree on the north side.

They have a coin-op laundry machine on site and piles of beach mats and
coolers to use on your expeditions. It was outrageously cheap when we stayed
there, and still seems reasonable.  I think it's close enough to stores to
walk, although I don't remember for sure (we did our grocery shopping on the
way back from drives around the island--the only walking I did was across
the street to snorkel :-).

Becky (jbecky at us.ibm.com)