I just did a Hawaiian themed BD cake for a 16th birthday. The customer and the 16 year old picked it out from another decorators website and I attempted to duplicate it. It was pretty time consuming, but not very difficult. I'm happy to pass on any tips if you like it (in my gallery).
Good Luck!
-Michelle
Msauer.. your cake is beautiful!!!
I too have a hawaiian themed cake planned for next week.. if you don't mind could you please tell me how you did the waterfall? I will be doing a 1/2 sheet cake with 6" & 4" teirs on top and I want the waterfall to flow on to the sheet. Hope that makes sense..?? Thx for all you can offer... it'll greatly appreciated it!! 
Im doing one at the end of this month! I am very excited. here is some of the stuff i thought of to include... lei, sand, castles, waterfall, grass skirts, hawaiian flowers, pineapple, flip flops,mini umbrellas, palm trees, hawaiian shirts, surf boards, shells, sunglasses, sailboat, hula girl, volcano, drink in a coconut, beach balls, beach towels, waves.
The waterfall is actually just made with piping gel colored with Americolor icing color. I tried a couple of different methods and this is the one that looked the best on my test runs. I like the way the smoothed buttercream underneath & the gel gave the water some "depth".
Mark where you want the water to stop, add on the piping gel and push it up to your line. (I actually did my sides and back first, so you'll really be pushing it up to your icing).
I added more B/C on top of the gel with a bag/tip and then used a small paint brush to blend the two in an upward motion to give it the effect of water splashing.
The back side of the cake was done by warming a small portion of icing in the microwave (until it became a bit thin and sloppy). I put that on top of my already smoothed B/C and then used the spatula to "pull out" and give it texture. Slow process, but I think it was worth it.
The hill on top was a spare piece left from another cake. I just carved it a bit, glued it all together with some icing and covered/smoothed it out. Airbrushed the color on.
The people, trees and bush things I used are plastic cake toppers that I found at my local cake store, but I wasn't sure I would be able to find the same thing so I searched them out on the www first. Here's the link:
Dancers:
http://www.fancyflours.com/hawaiian-hula-dancers.html
(oooh, I just found them on www.sugarcraft as well -"Hula Dancers". They also have the bush and tree picks).
The shells were all chocolate molds and the hibiscus were royal icing.
Dear Lord...I am rambling now....sorry! Does any of this help? Feel free to PM me with any more questions.
I just made a Luau Themed Bridal Shower cake. You can check it out in my pics. They didn't want any figures or other decorations on their cake, so this is what I ended up with. Good luck!
I did this one for anniversary, and the couple's nick name was the 2 bears, so this is what I came up with. Really an easy, quick cake though!
http://www.cakecentral.com/modules.php?name=gallery&file=displayimage&pid=4658
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