WHERE IS NICARAGUA? by Peter Davis (Simon & Schuster: $17.45; 306 pp.). In this anecdotal travel journal through a country at war with a U.S.-backed insurgency, Peter Davis, who made the "Hearts and Minds" documentary on Vietnam, mixes history with interviews and sightseeing. Like most American tourists in Nicaragua, Davis' trip was brief. He says he speaks "inadequate" Spanish. But unlike most visitors who arrive, tour and leave Nicaragua with their preconceptions intact, Davis captures the subtleties and contradictions of the revolution. For those who have not followed Nicaragua in the news, the book provides an easy primer on the basic issues--church, economy, business and politics--but doesn't offer any answers.