Just been there and got shafted by the car hire people at the airport, still in dispute over the extras that more than doubled our invoice.
Soller is nice, go to Agroturismo Finca Cas Sant just outside the centre for a glass of delicious home-made lemonade or orange juice straight from the trees.
Yes, the tram runs to Port Soller. Tramuntana bike hire has decent bikes, we hired Trek Emonda SL6 pros and they were good. The ride from Soller to Sa Calobra and back to Port Soller by boat would be good as that road is rated one of the best cycling roads in the world. The ride out to Cap Formentor is exhausting in hot weather but worth doing.