I was just there for a long weekend this past September. We stayed at a small hotel in Managua called the Mansion Teodo Linda, which was very nice and clean. Since I was traveling with several others, I was not able to be as adventurous as I wanted, foodwise. What I did eat, I thought was very typical latin fare - rice and beans, maduros, grilled meats, etc.
Overall, the country is very, very poor. There are throw-away/runaway kids all over the city center. They are high on glue and beg and steal for survival. We somehow got ourselves in a couple of unsafe situations where we had to be escorted back to our hotels by the police. Safety is still a big concern in Managua.
We visited some of the outlaying areas including the Massaya volcano and swung from trees and went bird watching in the jungle. These were new experiences to me, and I really enjoyed them.
We went to a beautiful higher-end restaurant just outside of Managua, called La Bosque, or something like that. I think it translates into "The Jungle" It is situated on an old coffee plantation and offers spectacular views of the city. I believe it was once the home of the first Catholic archbishop of Nicaragua. The menu was actually Italian, fairly simple and well prepared, but nothing outstanding. They grow their own organic greans. It was definitely the views and the location that made the meal memorable.
I have regular contact with a couple of ex-pats, so if you need some additional information, I can get you in contact with them, if you want.
Hammer