Got surf around Algarve 4 years ago this June stayed in Lagos itself in Villa Branca Apartments very nice. Surf was okay it wasn't that big. There are alot of surf spots around the southern Algarve (refer to storm rider)and they are not that long a drive from Lagos. I brought my travel board 7'6"(as far as I remember it was in the days before Aer Lingus used to charge for boards) and rented a car reasonable prices(beware the Portugeese drivers they are pretty mad) - not into the surf package thing myself.
Lagos itself is not really a nightclub spot more a mix of lively and mellow bars.
Portugeese are cool. I've been there many times. Having some of the language(even a few words) makes a big difference in restaurants and pubs. Avoid the places that have English/French/German menus, they are usually not as good food wise and more expensive..compared to other eateries.
Respect the locals