This is the ultimate hiking/rock climbing experience in Telluride. If heights aren't a problem for you and you are looking for a unique experience I highly recommend checking out the Via Ferrata.
Bridal Veil Falls, San Miguel River Trail, Valley Floor Loop, Boomerang Trailhead, and Bear Creek Trail. These are all moderately rated hikes with access through town. Blue Lakes Trail, located outside of Telluride, is a hike that is rated as hard but we highly recommend it! You can visit the linked website to find other hikes in the area.
We have used this Jeep Rental Company before. Pick your Jeep up at the gondola next to Mountain Lodge.