Playa Santo Domingo is the narrow wedge of land that connects the volcanoes of Concepción and Maderas , the product of rich volcanic soil that washed down from the slopes of both volcanes over millennia, gradually connecting the two islands.
The several-kilometer-long stretch of black sand on the northern part of the Istián Isthmus has some of Ometepe ’s most upscale (relatively speaking) accommodations. The swimming can be nice, but with the near-constant onshore breeze, the water is usually choppy and it can get windy.
If there are loads of chayules (gnats) when you visit, consider staying on another part of the island, away from the water, where these harmless but annoying little bugs are nearly nonexistent. Also note that in the rainy season water levels rise and the sandy beach all but disappears.
Rent a charming stone cabin at Villa Paraíso (tel. 505/2563-4675, www.hotelvillaparaiso.com.ni , $63-72). Rates are double for rooms with private bath and air-conditioning; suites feature air-conditioning, fridge, satellite TV, and hot water. The breezy waterfront restaurant is fabulous. Call early for reservations as the place fills up quickly, especially on weekends and holidays.
Next door, Hotel Finca Santo Domingo (tel. 505/8927-2019, $25–30) is less exciting, and rooms are simple and uninspired though some are air-conditioned.
Two kilometers farther down the beach toward Maderas  Casa Hotel Istiam (tel. 505/2569-4276) provides enormous value, and its beach is clean and pleasant. The rooms are so-so but cheap ($5 pp shared bath, $8 pp private bath) and the location is spectacular, with an impressive view of both volcanos from the second-floor deck.
There is one $25 double room with air-conditioning and private bath. The service is friendly and the restaurant good. Make reservations in Moyogalpa  at Hotel Ometepetl as they sometimes fill up. Camping is possible.