The following correction was printed in the Observer's For the record column, Sunday January 9 2010
We described 'a point on the Ataturk bridge (in Istanbul) where you can have one foot in Europe, the other in Asia...', but the bridge spans the Golden Horn, not the Bosphorus. And we took 1,000 years off Aya Sofya, the Church of the Divine Wisdom, which was built in the 6th, not 16th, century.
It's more than a little embarrassing that one of our first experiences in Istanbul was being ripped off in a "rookie tourist sting". It happened to me, and my travelling mate, Emma, as we took a night cab back to our hotel, the Ciragan Palace Kempinski, on the western (European) shore of the Bosphorus.
Cabs were already proving expensive – the Ciragan is some way from the main sightseeing areas, and the traffic was particularly dire because our visit coincided with Istanbul's annual marathon.
As much as this made the city difficult to navigate, it was worth it to see the streets festooned with colourful bunting, bearing images of the national flag, team colours from Turkey's fanatical football fans, and most numerous of all, the much-venerated founder of the Turkish republic, Mustafa Kemal Ataturk.
However, that night in the cab, we weren't admiring the bunting. Alarm bells should have rung when the driver dropped us hundreds of yards from our hotel, abruptly swerving on to the kerb. Then he insisted that the 50 lira (£20.50) note we'd given him for the L40 fare, was only a five and waved one under our noses to prove it.
Alone, at night, without speaking the language, it was hard to tell what exactly was happening as the driver became increasingly threatening, and demanded another L50 note. We told the hotel, but shamefully never made it to the police station to make an official complaint.
Back in the US, Emma came across a feature in the New York Times about the "10 biggest cons to avoid while travelling" – one of which was the "famous Istanbul cab driver trick, where they drop your L50 at their feet, and switch it for a L5". Doh, as Homer would say. If it happens to you, don't be drips like us: report it – the authorities are keen to eradicate this widespread scam.
However, it would take more than one isolated incident to put a body off a city as fascinating, idiosyncratic, as steeped in history and throbbing with vitality, as Istanbul. At once Muslim and western-friendly, famously straddling two continents (there is a point on the Ataturk bridge where you can have one foot in Europe, the other in Asia), and boasting centuries of culture, with its mosques, Ottoman palaces, hammams offering full-body salt scrubs and shopping bazaars, Istanbul takes a palpable pride in its place in the modern world.
Indeed, for all the ancient sights on offer, this year's Capital of Culture is a fast-paced international-minded city, boasting hotels, art galleries, shopping parades, restaurants, nightclubs and bars – non-stop modernity swirling through the sense of history.
Even the things you might expect to find jarring, such as public Tannoys relaying the call to prayer several times a day, end up being atmospheric punctuations to the Istanbul experience, to the point where, when I got home, I rather missed them.
The Ciragan Palace, the only five-star hotel on the European side of the Bosphorus, turned out to be, well, palatial, boasting helipads, shops, gardens and even a ballroom. Essentially two hotels, the palace part is where Ottoman sultans used to live. If you wish to stay in the master suite, it will set you back L30,000 a night – a mere £12,300. But the standard rooms are luxurious enough – ours had a balcony overlooking the Bosphorus, a marble bathroom, and handmade chocolates were delivered nightly.
Next door is a former harem, transformed into a high school. Buildings with strange histories seem to be par for the course in Istanbul – the Four Seasons hotel, where we sampled the fabled "afternoon tea", turns out to have been a notorious prison.
Finding ourselves imprisoned by the road-choking marathon, we ate lunch at the Ciragan's Gazebo Lounge and, later, dined at its flagship Tugra restaurant. With gorgeous views of the Bosphorus, the Tugra only offers Ottoman cuisine (not exactly vegetarian-friendly), and the silver platters and omnipresent waiters added up to a less than relaxing atmosphere. Exiting as gracefully as possible, Emma and I realised we'd spent the meal smiling so tensely we'd given ourselves cheek-ache.
This turned out to be our biggest culinary mis-step. The cuisine in Istanbul is varied and glorious. There are upmarket establishments, such as the fashionable and grand Matbah in the old city, offering food "just as the sultans ate it", and stand-up lunches from street carts – including balik ekmek (fish in a sandwich), corn on the cob and hot figs.
Istanbul's history as a trade route means the quality of its Indian cuisine is high. Dubb is considered the best Indian restaurant in the Sultanahmet, or old city (deservedly so; we couldn't resist dining there twice). The best tables are at the top of a long winding staircase, so don't drink too much: getting down is difficult enough sober. Once seated, you eat by candlelight, looking out over spectacular floodlit landmarks including the Blue Mosque and Aya Sofya, the Church of the Divine Wisdom.
Aya Sofya, once a church, then a mosque and now a museum, is no less impressive in the daylight. With entrance costing L20 (the standard tourist charge in Istanbul), and centuries of Christian and Muslim imagery jumbling together, this cavernous 16th-century building is seen as representative of Istanbul's harmonious melding of cultures.
Inside, people quietly mingled, taking photographs. Others, like us, yomped up the staggering amount of steps to take in the view from the upper gallery. As we left, some traditionally dressed women were crowding around the Weeping Column, pushing their hands against it. Legend says this is where St Gregory the miracle worker appeared, and the moisture from the column possesses curative properties. Emma and I dared each other to stick our hands in. Did it do swine flu, we wondered.
Close by is Topkapi Palace, which for several centuries served as Turkey's spiritual and political centre. Outside on the manicured lawns, cats were sprawling in the sun. Cats are revered in Istanbul and thought to bring good fortune, hence their air, in the Topkapi gardens, of owning the place.
A maze of buildings and courtyards, Topkapi is too much for one visit. Some buildings were for state business, others for domestic purposes, such as kitchens or bakeries. One room houses likenesses of Ottoman sultans and dignitaries, all looking remarkably similar – sleek, well padded, pale. Portrait painters were clearly the Photoshop of their day, prone to flattering subjects with the same look.
We got to see the Topkapi Dagger, as well as the Spoonmaker's Diamond, the fifth-largest in the world (eat your heart out, Liz Taylor). Also on display are eccentric-sounding religious relics such as the Footprint of Prophet Mohammed and the Saucepan of Abraham.
Annoyingly, you have to pay another fee for the Topkapi harem, and the queue was very long. It was disappointing not to view this scurrilous and highly political phenomenon (some sultans' favourites wielded significant power behind the throne). I tried to peek through a side window but could only spy a sliver of a mural – in the process disgracing myself as a kind of Ottoman Peeping Tom.
Topkapi is dwarfed by the 18th-century Dolmabahce Palace, known as "the Versailles of Istanbul". Outside, soldiers were engaged in a changing of the guard. Inside, the obligatory guided tour snaked slowly up the ornate staircase. At Dolmabahce, where Ataturk spent his final years, everything that's yellow is said to be real gold – and there is a lot of yellow. To protect the original parquet, you have to shuffle around in plastic shoe covers though seemingly endless throne rooms, ballrooms and state reception areas.
The nearby Blue Mosque, famously decorated with countless blue-hued mosaic pieces, is a stunning dome among Istanbul's many stunning domes – the skyline sometimes resembles a line-up of those bells you bang for attention in small hotels.
At the Blue Mosque, all visitors are asked to remove shoes and females are asked to wear headscarves, though quite a few don't. Indeed, at times in Istanbul we got the feeling our dogged religious reverence was overdone. Outside the Blue Mosque, Emma was putting on a scarf, when a guard suddenly barked: "You can't go in like THAT!" She froze: "Why not?" "You're too sexy!" he grinned, then strolled away, laughing.
At night in Istanbul, there is a bustling alfresco culture of crammed pavement restaurants in areas such as Nevisade Sokak, Mayhene and Kumkapi. Be warned: quality is variable. One night, we ended up having such bad meze in a deserted side street in Kumkapi that we dumped the money we owed, fled and finished our meal at a more vibrant eatery in the next street.
There I slurped down chardonnay that tasted of bubble bath (one black mark against Istanbul is the wild variation in the quality of wine), picking at the meze as cats wove about our legs. We smiled at some men at the table behind us who were feeding the felines, but probably shouldn't have. They fed them more to hold our attention, until we were seriously concerned the cats might explode. It was time to make an exit.
There is much scope for entertainment in Istanbul. We tried but failed to visit DogStar, an intriguing-sounding "indie club" in the Asian quarter. There are umpteen nightclubs and bars, some posh, others makeshift, many playing live music, or holding impromptu discos.
One night, we found ourselves watching students bop about to Soft Cell and Oasis in Kulp, a "club" the size of a shoe cupboard. Another night was spent listening to horrific Muzak in an upmarket though hilariously awful mirrored confine I forget the name of. Best of all was Babylon, a night club with live music. The time we went, guitarist Justin Adams, and African musician Juldeh Camara played an astonishing set. Babylon, currently celebrating its 10th anniversary, has also hosted the likes of Grandmaster Flash, Patti Smith and Arrested Development.
European Capital of Culture or not, it was time to utter the immortal phrase of every all-female city break since the dawn of time: "Lets go shopping!" Istanbul has a Harvey Nichols, and a pedestrian-only area in Taksim that could be Oxford Street (if Oxford Street had more antique bookshops).
In the less touristy back streets the scent of the city is strong, with street barbecues, bubbling coffee pots and thick cigarette smoke. There are scores of hairdressers – girls with the vibrant aubergine hair colour so favoured in Istanbul sit outside on stone steps, waving their hairdryers. In more upmarket areas such as Nisantasi and Tesvikiye, Emma tried on jewellery that should have had its own security guard.
No trip to Istanbul would be complete without a visit to the Grand Bazaar. It is the largest of its type in the world, and even reading the statistics is breathtaking: 60 streets, 4,000 shops, its own mosque, post office and bank, and even a health centre. Indeed, walking into the Grand Bazaar is akin to being devoured by a giant mythical animal, albeit one with a stomach full of rugs, jewellery (the "evil eye" symbol is ubiquitous), antiques, gold, leather, ceramics, calligraphy, and pretty much anything else you can think of.
I am too much of a wimp to haggle, though it is supposed to be welcomed here. But when Emma tried to haggle over some earrings, the stallholder told us to clear off. As we left, he yelled after us, "Don't come back!" So much for joining in with the local customs.
There are cafes scattered throughout the bazaar. The best is Café Bedestan, where we drank coffee and ate baklava. Some shopkeepers kindly offer customers a small glass cup of their refreshing local tea (cay), as they struggle to take in this veritable Aladdin's Cave. Indeed, so complex and compelling is the bazaar, it is wise to factor in a second visit.
We were coming to the end of our stay, so the next morning we made sure to view the Istanbul Modern, a wonderful art space with an eclectic mix of traditional culture and modern works.
Just outside the gallery, we stopped at one of the nargile (water pipe) cafes. These are enjoying a comeback among the young (with three universities, there is a huge student presence in the city). These days, the pipes are for tobacco, not opium, though there still seems something deliciously decadent about people lolling around on velvet chairs, sucking on bubbling water pipes.
Then it was time to say goodbye to Istanbul with a boat trip across the Bosphorus. There are guided two-hour cruises but we had no time for that. In any case, the commuter boats are fast, cheap and fun.
Our unpleasant experience with the cab driver seemed a world away as we glided across the water, marvelling once again at how the domes and turrets of old Istanbul nestle with the bustle and drama of the modern city.
A city of culture, indeed; but also so much more.
Essentials
A three-night stay at the Ciragan Palace costs from £837 through Kirker Holidays (020 7593 2283; kirkerholidays.com) including scheduled flights from Heathrow, private transfers, breakfasts and Kirker's guide notes to restaurants and sightseeing in the city.
