I used to go there all the time for work. I also heartily recommend the ghost tours! Great Fun. Another vote for the A1A brewery, good food, good beer, nice atmosphere. I also recommend the Cheese Wheel for good sandwiches. It's at one of the sites where you can pick up the tourist bus/train thing. A bit off the beaten path is a really good greasy spoon type diner called "Sisters". You go north at the main intersection in town (it's on Route 1), about 2-3 miles. If you go past the Northrop Grumman plant, you've gone too far. The restaurant is on the right side of the road heading north. A couple ladies took a buy out from Northrop Grumman and took it over from an existing place. I usually ate breakfast there if I didn't eat at the hotel.
The old fort is an interesting place to visit, and if you're okay with cheesy touristy stuff, there's the Ripley's believe it or not museum (I think it's the original site) and the fountain of youth.
Places to stay are tricky in St. Augustine. Remember that it's a very old place and has been a tourist town for a long time. I've stayed in some really nasty places there! They never close down, they just change names to trick the uninformed!
If you're looking for relatively inexpensive, but clean, I'd recommend the Holiday Inn Express out at the I-95 interchange. They have a good
AAA rate, and provide a decent continental breakfast. That ended up being the place I routinely stayed, because I knew what I'd get.
There is also a very nice Hilton out on St. Augustine Beach that many of my co-workers recommended, but it was a bit higher rate. There's a relatively new Hampton Inn on the main drag that's also nice (it usually was priced outside my govt allowance, so I only stayed there once).
I've also heard world golf village is nice. It's about 3-5 miles up I-95 (toward Jacksonville), but it's an easy trip.
Places to avoid:
The old holiday inn downtown. This is one that changes names on a monthly basis, but it has a Denny's restaurant in it which is usually listed in their literature.
Pretty much any of the Ramadas or Day's Inns. It's too easy to get confused and book the ones downtown which are really nasty!
The Ponce de Leon golf resort. At one time, this was a Radisson, but I think they lost their contract about 3 years ago. There are some nice rooms, but some of them are REALLY bad, and I wouldn't take the chance. Now if you're into golfing, they probably will put you in the nicer section, since they seem to be focusing on the package crowd.
One lesson I learned. If the hotel looks old, ask to see the room before you check in. Many of them won't refund your money once you're actually in the room.
Enjoy your trip!