this trip and were happy with the places we stayed. We stayed a few nights in a few different places and spent a good amount of time driving around and doing hikes, so definitely would recommend having a car. I think we did 7 days.
We went to Portugal on a different trip and someday will probably due a combined Portugal/Madeira trip, not sure if you've been to Portugal, but if not and you have the time spending a few days on mainland Portugal and then jumping over to Madeira could be awesome.