You do have to love a place that has towns with cutesy names such as Snug and Plenty and Flowerpot! It sounds so Enid Blyton, doesn't it?

In the beginning, this vaguely apple-shaped island had many fine orchards too. It was a marketing manager's no-brainer.

"Let's sell it as the Apple Isle!" they said.

And so they did, a campaign which worked extremely well. Too well. In fact, for the past few decades Tasmania has been striving to shake off that tag of single-excellence.

With its huge black summer cherries, creamy raspberries, and world-class seafood, I was already a fan of this pocket-sized state. However, on a recent trip, I was after something even more. I wanted to touch the heart of the place and see what made it tick, beginning with the obvious, its romantic legends.

Romance comes to mind easily here. On a map this heart-shaped island appears to swing like a lover's pendant on an invisible chain from the southern corner of the Australian mainland. King Island in the west, and its alter ego, Flinders Island, on the eastern side of Bass Strait, could just as well be matching gems strung there to enhance the setting.

In reality of course they are all that remains of the ancient land bridge which once saw Tasmania as a cape of Victoria rather than an island. Strangely, if that had remained the case, the idea of a trip to Tasmania would have lost much of its charm.

This generation's real fairytale story is the eternally romantic one of the commoner and the prince. Hometown Hobart girl, the former Mary Donaldson, meets a prince from a distant land. They fall in love, marry and live happily ever after. Aaaah! All the elements are there, barring the glass slipper. Little wonder that many Taswegians (another nickname) are suitably delighted with this real life tale.

On one trip I casually ask a local: "Tell me, have you ever met Princess Mary?" I expect an excited celeb-spotting response. Something like "yes, I saw her once when she was her on holiday with the prince - they were leaving a café". But, no. This person's daughter had gone to school with her, and the mother's reply was just what I'd wanted to hear. "I know her well," she said. "She's really lovely. Just the way she looks!"

But there are tigers in this toy-town setting too. At least there once were, although some say the Thylacine, aka the Tasmanian Tiger, still roams some of the dense and damp forests of the south and the interior. Sightings have been made. Myths woven. But even these bad-tempered devils are now endangered by a horrific disease and may not survive.

Geographically Tasmania is full of romantic notions. There is Wineglass Bay, a stunning bite of turquoise water cupped by the Freycinet Peninsula on the north-east coast. Perhaps it's no accident that just a stroll away across the isthmus is Promise Bay. Do you hear proposals and imagine weddings on the beach, too?

Nearby is the luxury five-star Saffire Resort, surely the ideal honeymoon location. It has front-row views of Great Oyster Bay and the Hazards, a line of starkly beautiful and appropriately rose-tinted mountains.

Then there's Honeymoon Creek, in the north eastern corner near Pyengana. It runs into the Groom river which in turn empties into the Ransom (are we building a bodice-ripping theme here?) but finally loses the plot when it mingles with the George River and empties without fanfare at the coast north of St Helens.

Warming to my theme, I recalled a milk bath I'd experienced in Hobart on a much earlier trip. I must have been one of the trial users, as the product is now exported around the world, trading on what is one of Tasmania's biggest selling points - its clean, green, pure growing conditions.

This little island is a veritable aphrodisiac-lover's delight! Oysters, chocolate (remember this is the place that gave a nation 'Cadbury's chocolate with a glass and a half of fullcream dairy milk in every block') flowers, strawberries, honey, liqueurs, whisky, saffron, truffles - all the components for a lovers' feast. Even the winelist is cared for. Tasmania's first sparkling wine, made according to the traditional method champenoise, was created by Jansz in the Tamar Valley.

Abandoned gold mines are dotted around the north, there are diamonds in the Savage River area and Tasmania's own gemstone, the exotic crocoite - its official mineral emblem - are long slender rose crystals. Flinders Island has its own precious stone, the Killiecrankie 'diamond' which is actually a variety of topaz.

Then of course there's the swashbuckling sailing connection when the big yachts race down the coast from Sydney after Christmas each year.

And maybe it was the romance of winning - lucky in love, lucky at cards - that lured crowds to Australia's first casino at Wrest Point, just south of Hobart. Its tall tower still dominates the skyline and, the word is, it's as popular as ever.

Many Australians may not realise that white settlement in Tasmania took place very early in the 19th century. The second Australian colony to be established after Sydney was Hobart, in 1804, followed by Launceston in 1806, almost 20 years before Melbourne.

One day we leave Strahan, halfway down the remote western coast, on one of the Gordon River Cruise's sleek vessels. As we slip along the gleaming waters between ancient forests, we nibble on canapés and a sumptuous buffet lunch, and are invited to try some 'Gordon River chardonnay'. It's river water, actually, tinted a light gold from the forest's tannin-rich leaves which fall into it, and as pure as any water you could hope to find.

But it's not all lightness and joy. Tasmania's convict history is shot through with black periods of indescribably inhumane conditions. During the cruise we stop off at Sarah Island and contemplate the ruins of one of the most dastardly places where convicts were made to work in those same waters, logging timbers from the forest. Treated as slaves they were punished cruelly. Those tranquil surroundings would have made their suffering even more poignant.

Another late afternoon we travel in a small boat to tiny Bonnet Island at the entrance to massive Macquarie Harbour, which is over six times the size of Sydney Harbour. Convicts confined to Sarah Island called its narrow entrance, Hells Gates, as few ever left. We've come with hopes of glimpsing some of the 300 pairs of blue grey fairy penguins that nest on the two-hectare island. It is getting dark. We hear their screeches and by the specially dimmed red-light of our torches we can just catch sight of them huddled in their burrows.

The story of the Bonnet Island light house keeper makes us shiver in the gloom as our guide tells tales of his endless lonely days and terrifying stormy nights when inattention to the light could see ships dashed on the rocks, and lives lost.

Strahan's heritage cottages on the waterfront have been restored, perky as a film set, and the town is the epicentre for many activities. Another day we take the West Coast Wilderness Railway on the line to the mining town of Queenstown. The steam train with sparkling purpose-built reproduction carriages chug-a-lugs through rainforest and over tall bridges spanning fearsome gorges on the mountain miner's line, stopping occasionally at sidings.

Sitting up there at the front of the train in 'Premier Class' with canapés and bubbly it's all so scenic and, well - easy. I try to imagine how tough it would have been for the men employed to blast this route through the wilderness over a hundred years ago using explosives and hand tools. Someone has estimated the rubble alone amounted to 89,000 wheelbarrow-loads.

I'd always thought of Tasmania as a neat clean little island. As well I found a complex, enigmatic, ancient place. A distant isle of ghosts and gourmets. I'd come searching for the key to it, but found I'd unlocked a Pandora's box of mystery and legends - of misdeeds and mistakes - yet also indescribable beauty and surprises.

Just like the morning we'd first arrived in Strahan. A brilliant rainbow greeted us, arched over the boats in the bay and reflected in the water as a perfect ellipse. It framed the tiny town, and that memory became our perfect souvenir.

No need to search for that pot of gold. We reckoned we'd already discovered it!