In 2001, after my graduation from high school, I visited my Brazilian netfriends in Pocos de Caldas, which is located in the south of the state of Minas Gerais, on the border to Sao Paulo state. It's a lovely health resort city of about 130,000 inhabitants, nestled in the mountains.
Favourite spots:
the parks and avenues, the waterfall, the view from the Christ statue, the Japanese Garden
What's really great:
I especially liked the fact that Pocos is full of parks and avenues.
Sights:
parks and avenues, the (artificial) lake, the Japanese Garden, the Christ statue, the Palace Hotel and the Thermas Antonio Carlos, Fonte dos Amores, ....
Restaurants:
there are some restaurants in downtown Pocos, most seem to be self-service restaurants though (seems to be quite popular in Brazil).