Bali has everything a traveler can dream of, and there are some places in Bali where you can end up staying for weeks or even months even if your initial plan is just for a day trip; Ubud is one such place. Ubud has the best food in the world (it sounds like an exaggeration but is not), it's the best place for you to get sample Bali culture, and the people happily let you participate in their festivals and rituals.
While some may find Ubud a little too urban compared to, other parts of Bali, it's very close to a number of ancient sites, temples and traditional Bali villages. It also gives you the best accommodation options: you can live in five star resorts, or mingle with the locals by living in inns run by locals.