It is Waiheke Island, Auckland.
http://interfacelift.com/wallpaper_beta/details/1725/the_lookout.html
New one, with thanks to Antar Bolaeisk:
snip
Heres my current one.
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Linkings?!?!?!?!...(1920x1200 if you've got it!!)
I must say I like the choice of colours there.