SoCal newcomer...if you're still planning on the road trip to Uruguay, I'm back from our trip and we all loved it. I definitely recommend taking the the Ruta Balnearia & Ruta 10 all around the coast.
Although many, many places were closed this time of year, we stayed at Paradise in Atlantida, which had an incredible, huge, indoor hot pool. Also, Bravamar in Punta del Este, which seems to be the only centrally located, affordable, small hotel with a view. Both places were reasonably priced and came with breakfast. Nirvana was completely full, but looked very cool. We checked out El Diablo Tranquilo in Punta del Diablo, but their available room didn't come with any source of heat (and it was in the 30s at night). Piriapolis was an interesting town, especially the fish market on the east side. By far, the find of the trip was a restaurant called Mirjo in Punta del Diablo...we ate four meals there and they were all delicious, fresh and not expensive. We drove all the way to the Brazilian border, although Chuy was pretty much what you would expect from a border town. It was a beautiful country to drive around, and we were constantly impressed at how mellow and friendly everyone was.
Have a great trip! Thanks to everyone who offered suggestions...