The best breakfast place in Delaware (and I've eaten all over the state) is Sinclair's Cafe on Main Street in Newark. It is a tiny, funky cafe with outstanding pancakes, eggs, bacon, and even a pretty good veggie sausage. Pancakes are a different variety each day, served with real maple syrup. Tea (a particular interest of mine) comes in many varieties, loose leaf, in your own teapot. I hear they have good Irish oatmeal, too, but I haven't managed to get past the other stuff yet and try it. Everything is homemade, fresh, and from scratch. It's a teeny little place, but has great charm -- and great food.
We also really enjoyed Mastoris Diner in New Jersey, which is worth it just for the hot loaves of cinnamon bread and cheese bread which arrive, gratis, when they take your order.
And since I'm originally from Pennsylvania, I should mention that scrapple is the unique breakfast food there that you really should try -- however, I don't know if you will find any up near Erie. It's more of a Pennsylvania Dutch thing, common in the Eastern half of the state.
<message edited by emmymom on Thu, 03/3/11 4:31 PM>