I had one of the most memorable experiences in Nicaragua in a town 2 hours north of Managua called Esteli. My wife (from Nicaragua), the kids and some of her family went to a midnight mass on New Years Eve in the cathedral in Esteli which is a very beautiful building inside and out. There are many statues and hand carved wooden pictures depicting the Stations of the Cross. They had the church decorated in elaborate nativity screens on the side altars and other decorations of silk cloth and ribbons hanging form the pillars.
It was very warm and the doors of the church were open and the warm night air drifted in. The church was packed with people dressed in their best outfits. They had a marimba band playing beautiful Spanish songs during mass. At the mass the priest used incense and it filled the church with a beautiful aroma.
Afterward we went to a cliff top restaurant (on the right when you first enter town on the Pan American highway). From the top of the restaurant you can see the surrounding valley and the city lights below. From our table we watched the fireworks exploding over the town and ate, drank and danced on the open air dance floor to the band till all hours of the morning. The whole experience was just beautiful and one of my most memorable in Nicaragua!