Hi Ashby,
Sri Lanka is an amazing destination, I've been 3 times in the last 4 years & I'm going again in June this year. There's loads to see and the people are really lovely and friendly. First time I went I did the "formal tour & beach" thing in 2004 with Kuoni, which was a great trip and they are a good tour operator, but maybe a bit pricey.
Since then I've found it's really easy to book overnight trips inland to the major sights when you are actually there in your beach resort - it's a lot cheaper whether you choose to buy from the tour operator or the beach boys than it would be organising it back in the UK. You can easily tailor make your own private trip.
AND you get to keep your beach hotel room while you are travelling.
If I were you I'd have a look at some of the great deals out there right now with operators like Hayes & Jarvis or Mercury Direct. They use scheduled flights with quality airlines and the prices currently reflect how desperate the airlines are for business.
Choosing your beach hotel - watch out for transfer times. Many hotels are in the south west eg Bentota - and it takes nearly 3 hours to get there from the airport. It doesn't bother me - I enjoy seeing the sights & culture
- but the standards of driving there do scare some folk!!
If you don't want such a long transfer try Negombo or Waikkal (the Dolphin hotel there is pretty good!)
One thing to watch wherever you go in Sri Lanka - if wine is your favourite tipple - (as it is mine)
You will find that almost all of the AI deals exclude wine, and buying wine with a meal is normally priced at a level which makes your eyes bleed!
Hope this helps - any specific questions - I'm happy to answer.
Have a great time

Thanks for the infomation UKBil - Its certainly sound like a good idea to arrange trips from a beach base - saves repacking -sad about the price of wine. Will start some research.

Ashby - You do need to bear in mind that doing day trips will probably mean hours sat on a bus - the distances don't look too bad on the maps but you have to allow about 3 times as long as you would expect to get anywhere! We did the Kuoni 7 day Sri Lanka Highlights tour by private car and it was great. We added on an extra night at the Mount Lavinia at the start to recover from jetlag (well worth doing) and then had 4 days at the Blue Water (this turned out to be a bad idea for us as we got bored quite quickly). You can see the full review in this topic: http://www.holidaytruths.co.uk/viewtopic.php?f=69&t=96856&start=60

UKBill also makes good points about booking day trips meaning less unpacking and disruption - you'll just have to decide what suits you better. I'd definitely do the same thing again though!