I dove down in Cabo in June of 2005. The diving was decent in terms of things to see, but the water was chilly. I think my computer logged 72F on most dives. We dove with Underwater Diversions after walking around and chatting with several dive shops. They were great and we always had a DM with us. I brought a 3/2mm full because i did not do any research about water temps beforehand and had to borrow additional wetsuits that they did not charge us for because they said the water was unseasonably cold.
During the week, we also did a trip to Cabo Pulmos and it was definitely worth it. It's an all day trip, but IMO, the diving is much better than Cabo. We saw a hammerhead briefly, several manta rays, tons of other fish, and the water was noticeably warmer.
Cabo also has many great restaurants near and away from the marina. The best sushi I have ever eaten was in Cabo...go figure.