When I was on Terceira Island (between 1990 and 1992), I did not know of any B & B-like places. But a lot of things have changed in the 14 years since I left the island, so I can’t say how this situation is right now. Sorry that I was not able to give you more help.

You may want to join a group on Yahoo called ilhaterceiraisland. Look for it under the groups section on Yahoo. Someone there may be able to answer your question. I used to be a member of it, but left after I received most of their e-mails in Portuguese. Unfortunately, I only learned about 100 Portugese words while I was there, so I don’t know the language well.

Good luck, and hope that you will be able to go to the Azores. If you visit there, I know you’ll have a great time!

I don’t know if this will help you much, because although I live in Portugal it has been a while since I’ve visited the islands.
But searching for accommodations in Azores depends a lot of wich of the islands you are planning to visit.
Anyway, try searching in http://www.tripadvisor.com/Hotels-g189123-Azores-Hotels.html
It’s one of the few pages about this subject I could find that weren’t written in portuguese.
I hope you enjoy your vacations; the azores are an amazing place to visit.