South America - Rio - Iguazu Falls - Bus

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We (two couples, 60s) plan a trip (5 weeks October - Nov, 2012) Rio de Janeiro to Santiago, Chile by land. Like to go by bus from Rio to Iguazu Falls then across Paraguay the northern Argentina (Salta and more) then Mendoza and Santiago, Chile. Any advice on buses from Rio, like to make this 2 or 3 day trips. Anyone taken bus across Paraguay? We have traveled in Argentina and Chile by bus. Places to stay in Rio would also be appreciated - private room in Hostel or Hostal in save area.