My husband & I have been going to Bali for several years & personally we find Kuta very crowded & touristy. Certainly it attracts the younger crowd so is great if you want to get in some surfing practice (very small waves), plenty of night clubs & hotels to suit all budgets.
If you want a more exclusive holiday with a good beach to chill out on, book in to one of the hotels in Nusa Dua.
On the other hand if you are looking to soak in the culture, Ubud in central Bali is a good spot to be, though do make sure to book in to a hotel that is a little away from teh main town.. Ubud is about an hour & half from Kuta or Nusa Dua by car (subject to traffic conditions, as it can get quite bad during peak periods) so you could do stay at any one & still do day trips to the others. about 6 years ago
If you do decide to stay in Kuta, there are various options dependant on your budget. It also really depends on your interests and what you want out of the holiday. Relaxation - dont head to Kuta.
Seminyak is more upmarket (still crowded) and has many lovely private villas to stay as well as restaurants and shopping. Also, brilliant massage parlours and little cafes.
Kuta is busy, noisy and very touristy. Think cheap markets, a lot of cars and a lot a drunken tourists. The beach is crowded, but if the pub / nightclub scene is your gig, then this is your place.
Sanur is close by (10mins drive in traffic) and a more quiet beach resort. Nusa Dua the same. Upmarket resorts, but lovely beaches and much more quiet.
My preference in Bali is Ubud because I love the serenity of it, and I also really love Singaraja (a little less discovered).
Bali and Lombok are both very different cultures, Bali is a predominantly Hindu country whilst Lombok is predominantly Muslim. If you are seeking a but more of an island escape with less tourists, perhaps split your time between Bali and Lombok and take in a visit to a the Gili Islands. about 6 years ago
In Kuta, you just will get Beach with alot of people, so noisy during day and night, Kuta is just offered you no more than beach, the sun, hang out around the pub and bar at night...so if you are looking something different go to Ubud... about 6 years ago
I would only recommend Kuta if night life is your top priority. I really like Ubud. The atmosphere is very relaxed there compared to Kuta. If you are looking for beach vacation you do not want to go to Ubud though, some of the above options could be a good idea. Sanur is nice if you like a more polished place. There is some really nice accommodation option in Sanur- For example take a look at these Sanur villas: http://www.vilondo.com/sanur-villas-bali.html about 6 years ago