Disneyholic- I am on your side.
I have done many vacations with extended family (especially cruises) and we have always set ground rules for neices, nephews, cousins, etc. who were over 21, but under 30.
Our family ground rules seem like they are for the safety of everyone.
- Do not get totally wasted...I don't want the drunk girl in my room! Not to mention the drunk girl who may go with Joe Smith to his room. (get the rule: they may be adults, but they MAY loose the ability to make wise decisions when on vacation or in a large partying group)
- Hang out with people your own age...like the above poster, I don't want a 25 year old hanging out in the club with a 16 year old.
These are just a couple of the major rules, but the gist is to protect them and the people around them.
There are rules all over the place for adults. Some are unspoken but there are still rules. I don't think it is bad to have them for your kid (no matter how old they are) if they are travelling with you...they are still your kid.