My favorite Niagara winery restaurants are Hillebrand Estates, Vineland Estates, and On the Twenty at Cave Springs Cellars.
By far, the nicest place to stay is the Inn at Cave Springs Cellars, but it's very expensive. The beautifully-furnished rooms are large and have fireplaces. In Thorold, there's a modestly priced Sheraton Suites Hotel which is particularly good if you're travelling with children. Inniskillin (or was it Konzelmann?) was opening an inn last time we were there, but we didn't stay there.
As far as tasing goes, all the winereies are worth visiting, but I'd recommend a few for special reasons.
1. Vineland Estates makes a wonderful Cabernet Franc Ice Wine.
2. Stoney Ridge produces some reasonably priced ice wines and some other fruit wines that can't actually be called ice wines, because that term is reserved for grape wines. Their blueberry wine was pretty good.
3. Kittling Ridge has an interesting tasting room with a lot of other things to buy. I didn't like their wines too much.
4. Thirty Bench makes the best Riesling ice wine in the area, imo.
5. Don't miss a small winery up a narrow road. It's called Crown Bench. Take your camera for a picture in the stone archway in front. The owner runs a small tasting room. He has produced the most unusual ice combinations. Don't laugh. He has one called Ambrosia which is a combination of ice wine and chocolate and it's quite good. My favorite of his is called Hot Ice. It's a jalapeño flavored ice wine and somehow the combination works well.
In my experience, skip the dry wines except at meal times. Don't neglect the non-vintage reds at the restaurants, because they may be the most accessible and they're relatively inexpensive. Vineland Estates non-vintage red, in my opinion, was better than their vintage wines.