Cusco/Machu Picchu

I haven't been but they should be prepared for rain, as the rainy season lasts until May.

http://traveltips.usatoday.com/time-year-visit-machu-picchu-12557.html

I haven't stayed at the Loki hostel, but from what I have head, it's a typical party hostel. I don't know about their travel company, but my experience in Cusco was, that it was way cheaper to book excursions in the city, where you can shop around between different companies. I went on the Salkantay trek to Machu Picchu and people in the group had payed vastly different amounts for the same trip, depending on where and when they booked it. The ones who had booked it in advance before comming to Cusco had payed the most.
Get your daughters to have a look at the travel forum on the lonely planet website, it caters more to young backpackers.

We were there last year during Spring Break.
The weather wasn't bad, light sweater weather. We are from the Pacific Northwest, so we are used to colder weather. Our trip was for 6 nights. Only place that it rained was at Machu Picchu.

We stayed at a hotel in Cusco, so not familiar with the Loki Hostel.
Hope this helps.

The rainy season is typically over by May. That doesn't mean rain is impossible, just no where near as likely as it would be in say December-March when mudslides can close the site. I've gone in April and while it was foggy in the morning things cleared up by 10AM.

I'm not specifically familiar with that hostel but if you do some digging you should be able to find info. I found that Cusco hostels are very very "young European bohemian". They're not dangerous or anything but expect Dutch and German hippies and their... Ahem... "hobbies".

Cusco, especially in the touristy zone around the main plaza is generally a really safe city. If you're daughters travel regularly without problems in major North American or European cities they should have no problems.