The Mercat is a bit tidier these days than it used to be, and has a space downstairs, so you should be fine in a big group. Teuchters is a few minutes walk away, but is a nice little pub with a reasonable range of beers. It can be a bit tight for space at peak times there though. I don't drink in that end of town terribly often, but I'm sure the locals will be along shortly to sort you out.
The floral clock (with cuckoo sound) is in Princes Street Gardens, at the bottom of The Mound if I remember correctly.
Cannon is really a gun, and goes off at 1pm at the Castle.
If the weather is good, worth taking a walk up Arthurs Seat / Salisbury Crags or Calton Hill for the view.
If you do a tour bus, give me a wave - I work next door to R L Stevenson's house, so get hundreds of tourists peering in the window every day.
Unfortunate timing on the weather - it has been bone dry for about 4 weeks, but looks set to piss it down this weekend.