I was there in 2001 and the reefs in Roatan were ok, but no fish. The reefs in Utila were in pretty rough shape above 50', and just ok below that. I am not sure if they had gotten hit with a hurricane or had some kind of coral bleaching problem but it was pretty rough.
One of the best reefs I have ever seen was off of Puerto Rico. I have to admit to being a little surprised by this considering the amount of people on that island, but the reefs were realy noce- saw a few fish but not as many as in other places.
Ted told me you guys were looking at a few other places and I would recomend Bonaire- they even have a freediving operator on the island now.
Jon
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Imagination is intelligence with an erection. - Victor Hugo
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