Hi Dawn. We drove to Lake Garda (after visiting Venice for 5 days) last August. We stayed in Lake Garda for 3 days (1 night in Sirmione and 2 nights in Malcesine and we stayed at Hotel Vega which I see you are considering). From Malcesine, we took the ferry to Limone sul Garda and Riva del Garda for day trips.
The ferries between Riva and Malcesine call into Limone on the way (and some also into Torbole), so you can decide whether to visit Limone first then go on to Malcesine or the other way round. If you decide to go on the cable car then it's better to get there as early as possible which could mean either the bus or driving. It opens at 8:15 am.
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limone to riva del garda ferry