I travelled by bus but it's worth spending a little more on car rental. You'll see much more. have flexibility to stop at any nice beach you see or towns. I'd rent a car if I go back the next time.
Of course the best is to cruise up or down this stretch... or better still have your own sail boat or rent one with some rich friends! =)
We crossed over to Bosnia for a while before getting back to Croatia... Croatia is split in the south.