I'm surprised the Cuenca folk haven't answered, and the weekend it almost here. I don't live in Cuenca but I've been there a couple times. I agree with Neil. It sounds lame riding on a tour bus, but it's totally worth it.
Here are a few things I really enjoyed in Cuenca.
I like to try the food at the markets, you know, the ones with a ton of fruit/veg/meat vendors. There's a nice indoor market on the corner of Mariscal Lamar and Hermano Migel. On the top level of the market, there like 10 stalls all selling hornado (roasted pig). It's the best I've had in Ecuador. If you walk by them slow enough and look tentatively interested, they'll give you a piece to sample. This market, next to the hornado, has the best juice I've had in Ecuador. The coconut juice is amazing. They blend it with ice, so it's like a milkshake. Also, my favorite and cheapest breakfast in Ecuador is in the same place. In one of the corners, behind the juice people, there's a lady that has a huge pot filled with rice, pork, pork skin, and some vegetables. For a dollar, it's a bowl of this stuff with a hard-boiled egg, and for $.75 you get a smaller bowl without the egg.
If you haven't tried guinea pig yet, I had a good one across the plaza in front of the market. On the corner of Mariano Cueva and Gaspar Sangurima, after around 5:30pm there's a few women roasting guinea pigs on sticks. It's cooked well and way cheaper than anything I've found in Quito. 6 or 7 dollars for one. It comes with potatoes and mote, but don't bother. Just get the guinea pig.
There's a microbrewery on Calle Larga and Presidente Borrero. It's pretty good, for Ecuadorian microbrew standards. A liter was 4 bucks a year ago.
The Incan/Cañari ruins at the SE end of Calle Larga are pretty cool. I'm not much of a museum guy, but walking around the ruins and by the river is nice. They've got some toucans and llamas and other animals down there too.
There's tons of hostels in Cuenca. Many of them may be full because of the holiday. I like to stay at Hotel Pichincha on Juan Montalvo between Marical Sucre and Simón Bolivar. It's nothing fancy, but it's $7 per person per night. The owner's nice. There's a computer with internet to use and I think you can use her kitchen. They just moved locations, so everything is new feeling. Shared bathrooms, but each bathroom is shared with only 3 rooms and they're clean.
Have fun. I hope some other people can give you more ideas of stuff to do.