Possible Itinerary

I like your itinerary. You are giving Napflio enough time which most travelers do not. Include Mystras as a day trip from there.
In Delphi, book a hotel room with a view. We saw all the way to the sea.

Another option would be to depart Athens on Day 4 and drive to Delphi. Then drive from Nafplio to the ports at either Ermioni or Metochi and go to Hydra from there. You may even be able to drop your rental car and take the ferry from Hydra back to Athens after your stay. I had explored these options for a planned trip that got cancelled due to COVID - haven't researched current schedules, etc. Another idea is to pick either Delphi or Olympia to reduce your driving time and visit other sites (i.e. Ancient Corinth) that won't require too much extra driving. The only place on your itinerary I've actually visited is Athens - but I have had 2 planned trips to the Nafplio area cancelled in the past 6 years due to things out of my control. Enjoy your trip!

Thanks so much to you both! One concern I have is whether we are spending too much time on Hydra? We want that part of the trip to be relaxing and slow paced, but I wonder if we will get bored? Thank you!

Three nights is what I had planned for on one of our cancelled trips.

I think I'd get bored with three nights on Hydra, i.e. two full days. I'd give one of those days to Athens. Remember that on day 1 you'll be jetlagged, leaving you just two full awake days for one of Europe's outstanding cities. A whole lot more to see and do in Athens than Hydra. You might be able to make this decision after you get there if your hotel reservations can be changed.

I would not go too far out of my way to include both Delphi and Olympia when eliminating one (if I had to eliminate one, it would be Olympia because Delphi and Olympia are a little redundant and Delphi has an infinitely better view) might give me the chance to see several other less-famous places.
If you steal one night from Athens, one from Nafplio and one from skipping Olympia (and the long drive) you could add from a choice of Meteora, Monemvassia, Mystras, Corinth, Nafpaktos, Galaxidi, Parga, Epirus .... so many amazing places.

Thanks to all for your responses. We recently realized that the day we planned to sight see in Delphi will be Orthodox Easter. Given my worry about lingering too long in Hydra, any opinions on removing a night there and adding to Delphi? This would give us two nights in each of these locations. We also would have less risk of missing the sights there due to the holiday.

We had a similar itinerary in 2018. We spent three nights in Nafplio and thought that was enough.

In Hydra, we spent one night and wish we had spent two. A third day would have been fun for long hike around the island.
Another night in Delphi would be nice. There is a trail from town that goes above the stadium and has great views.
As another suggested, consider picking up car in Ermioni. It'll be a nice drive going north on narrow roads and small villages. GPS highly recommended.

I think I'd get bored with three nights on Hydra

Me too!

Thanks, all. In our current itinerary, we will have the ferry in the morning of Day 7, arriving at 11:35am - then drive from Piraeus to Delphi - then try to see the archaeological site before it closes at 3:30 - all because it will be closed for the holiday the following day. I think stealing a night from Hydra to avoid this chaos might be the smarter move. Appreciate all additional insights.

You also will have to pick up the rental car after you arrive. That will take time. My two cents is I would take a day from Hydra to actually be able to see Delphi or I would skip it all together.