Totnes has lots of lovely cafes and is a great place to just go and potter around. I would recommend the Curators Cafe on the Plains for fab coffee, the Tangerine cafe at the top of the high street for good lunches as well as the Brioche.
Sharpham Estate Cafe is also very good (recommended by us and the Observer Food Monthly!) you can walk straight from the house along the River Dart for either coffee and cake, great lunches or wine and cheese tastings!
Riverford Field Kitchen is located about 25 inutes drive from the Shippon, it does amazing organic food and fabulous meat. You need to book but its a lovely place and can cater for huge numbers on its long, long trestle tables.