Lima may be the capital and flight centre for Peru, but I've never heard a good thing about it. It's a busy city generally covered in smog. On your average holiday to Peru it is worth avoiding it. If you need to pass through to connect one destination with another, remain in the airport if possible.
We flew straight into Cuzco from La Paz. It's also worth noting that its not the easiest destination to fly in and out of. It's high and can be affected by bad weather. Delays, cancellations, or we even heard of early departures. But at least we got straight to the core of where we wanted to be. In fact we had decided to get a cab (about £20 for a 2 hour trip) to Ollayantatambo. When travelling as a family (4 of us), taxis don't always work out as a bad option. There are Inca ruins there and its a fairly small town with various restaurants and shops (Hearts Cafe which raises money for local issues was a favourite). Its also on the train line to reach Machu Picchu. Local villages can be seen in distinct costume which distinguishes each community. If the big town hubbub of Cuzco is too much this place is a lovely alternative.
Also it should be noted that while Cuzco is at the altitude of 3400m, Ollyantaytambo is at only 2790m, Aguas Calientes (the busy town at the foot of Machu Picchu) is 2040m and Machu Picchu itself is at 2430m. So when people struggle with the altitude on arriving into the area, actually they just need to get out of Cuzco and they are likely to feel just fine. Cocoa tea can help and is readily available.
The entrance fee to the site at Ollyantaytambo seemed pricey at around £30 an adult, especially as we had limited time to spend there. Apparently this allows you to visit many Inca sites in the area, but this wasn't an option for us. We soon established that it was negotiable so it is worth bartering. We wandered the terraces and admired the advanced water system and the so perfectly placed and polished stone walls. Each stone fitting exactly with the next - no concrete needed.
From Ollyantaytambo we took the picturesque Perurail train the rest of the way to Aguas Calientes. This is a busy town built up around tourism to Machu Picchu. There you find a throng of hostels/hotels, restaurants, souvenir shops and the buses that relay visitors up to the main site about half an hour away. At the end of a tiring day people walk up to the hot pools, that are more social than natural, at the top of the town. Bring your swimmers and towel. Also it's important to carry sunscreen and insect repellent. Having spent some time at altitude, and with chilly weather, we weren't prepared for the glorious day that presented itself for our one-day ticket to Machu Picchu. With clear blue skies we couldn't have asked for better, but the sand flies were there to greet us too!
When I last visited Machu Picchu about 15 years ago, I took the Inca Trail which is a strenuous 3 day hike that delivers you to the site in the early morning before the crowds. Unfortunately we arrived to thick cloud that didn't clear until the tour buses had arrived in their numbers. These days visitor numbers are limited to MP (2500 people a day so it's wise to pre-buy your tickets), but you will still see a horde during the middle hours of the day when the trains have come in from Cuzco. Many people do a day trip from there only. If you can avoid this I would. By staying in Aguas Calientes you can take an early morning bus, see sunrise even, and then stay until 5pm when there is almost no one there.
In fact, the perfect way to see Machu Picchu - if you can afford it - is to stay at The Sanctuary Lodge just outside the entrance itself. This Orient Express hotel has an exclusive spot and there is no other accommodation anywhere near it. They offer a buffet lunch with local musicians accompanying it to anyone willing to pay $40, and there is a cafe there too, but the hotel is closed to the general public. To stay here means you are amongst the limited few that can go into MP for sunrise, siesta in the afternoon when the site is at its busiest, and then return towards the end of the day to enjoy the tranquility.
Machu Picchu carries a special energy. The Incan leaders of old worshipped the sun here and enjoyed milder winters than in Cuzco. When the Spanish were powering through their kingdom the Incas left and cleared the area so as not to lead the Spanish, who would have destroyed it, to it. It remained 'undiscovered' until 1911 when the American Hiram Bingham III was led to it by a local farmer and found it submerged in jungle.
What you may not realise from the classic images shown of Macchu Picchu, it is not just the Incan site that makes this place so incredible. There are towering green and snow-topped mountains totally surrounding it, with MP actually miniature in their centre. We included in our ticket access to the mountain of Machu Picchu which overlooks the structures. It took 2 hours of steep climb to reach the top which allowed us to look down over the whole scene. It is also possible to book to climb the mountain of Huayna Picchu. This is the peak that is always seen behind the ruins as part of the site and allows you the opposite view from the typical postcard one once you reach the top.
I recommend spending the whole day at the site. Bring a picnic, plenty of water and perhaps have a map under a tree in the middle of the day. With talk of further restrictions on future visitors, and already lower numbers allowed on the Inca Trail, who knows how long visitors will be given the freedom to enjoy this special place - without it costing a lot more!
We booked tickets through the official website - www.machupicchu.gov.pe - at about £30 per adult (additional costs for climbing the mountains too). It can be difficult to get some credit cards accepted, but with perseverance, advising your bank and using the site in Peruvian office hours it is do-able.
Booking train tickets on Perurail's website worked OK after a bit of fiddling about. The main difficulty is not having your bank cancel the card when trying to book things in parts of South America through the internet - again keep them informed of what you are up to. We took the Expedition train one way and the Vistadome the other. Both had viewing windows in the ceiling. The only difference it seemed was that there was a modelling show of highly priced quality alpaca garments on the more expensive Vistadome!