When you visit Ecuador, you will most likely want to go to the Otavalo market. Otavalo is an indigenous and mestizo town about 3 hours drive from Quito. It is doable on a day trip from Quito but, you miss the chance to explore the area at all. I suggest 1 night if you are pressed for time and 2 or 3 if you have some leisure.
The market is open everyday, year round, but on Saturday there are more vendors as the local people bring in goods for sale. As markets go, it is impressive for first time visitors to such events. There is a huge selection, so variety is good if you are shopping for things to take home. Make sure you bargain heavily. The vendors are savvy.
One thing I really did like at the Otavalo market was the interesting food and plant products for sale.
There were also many other vendors selling prepared foods like cooked fish, breads and biscochos (tasty, buttery biscuits, like cookies, but not sweetened). We were visiting over the holiday weekend of “dia del muerte” so there were many different foods available. The Guagua de pan is the traditional treat for the season.
If you can stay over for a few days it is well worth asking your guide to take you to some of the smaller villages around Otavalo as there are wonderful small textile shops and even musical instrument makers.
Of course the big ticket items are the pure alpaca sweaters, jackets and hats. You have to be careful to get real alpaca because there are many wool imitations. Like everything else the more you pay, the higher the quality. Real alpaca yarn is made from the sheared coats of the Vicugna pacos, a small a llama like animal. It is distinctive for being very warm, since the animals are native to the high Andean mountains, and very soft. (read more about alpaca on Wikipedia http://en.wikipedia.org/wiki/Alpaca ) .
These traditional skills live on in this area, and others, and while the rest of the planet moves ever more rapidly to a digital reality, I can’t help but think that one day we’ll need this knowledge for our survival.
Beside the markets, the Otavalo highlands also has a birds of prey conservation center that features daily flight demonstrations with merlins, hawks and eagles. The site is near Otavalo and well worth the admission. Weekends are busy and many people come to see the raptors. The birds are all rescued, not captured. There is a magnificent enclosure with the andean condor, about as close as you can ever expect to get.
Other than this, you can drive to the Mojanda lakes about 30 minutes away and see some of the amazing páramo ecosystem, (http://en.wikipedia.org/wiki/Paramo) tufted grasslands on the slopes and valleys. You can also see the ancient, but still used, Inca trails along the mountainsides and imagine yourself in a time long before cars and computers.
There are several other things in the area, best left to a separate post.