West Lake is undoubtedly the most scenic spot in Hangzhou. To get there, take the K7 return bus and get off at any of the stops along the shore of the lake (5min - 2CNY). You can take a boat and visit the islands (approx. 80CNY), but it's not particularly interesting. We recommend simply taking in the views from the shore while walking along the edge of the lake.
For lunch, we recommend going to the gardens northeast of the lake (close to the botanical garden). There you'll find a group of very nice restaurants. Don't miss the chance to try such local dishes as fried prawns, Beggar's chicken (chicken cooked in a casserole dish), Dongpo Pork (braised pork) or lake fish in sweet and sour sauce.