I know that the Japanese tried to punch the United States hard and fast to be over with the war before it really started and that Yamamoto's plan was not followed as he intended (not destroying the fuel depots in Pearl Harbor and not attacking Midway on the way back) or else it would probably have been much more effective.
But would an invasion and occupation of Hawaii not have been the best choice? Instead of destroying the main US base in the Pacific, you take it and use it for yourself. There would have been no harbour for the US Navy for thousands and thousands of miles in the ocean, crippling the fleet much more than simply destroying a number of ships (some of which were recovered later anyway).
On the surface, this could probably look like the best option, but the moment you start considering it in depth, it becomes untenable.
The Pearl Harbor attack was already far beyond the normal range of Japanese warships - the Japanese had to figure out how to refuel at sea just to make it to the launching point (Gordon Prange's At Dawn We Slept goes into a lot of detail about the planning and problems involved, and I vaguely recall Craig Symonds' World War II at Sea does as well). To carry out an invasion would have involved a contested landing against a military base that was already showing signs of gearing up for a war (and, in fact, General Short thought that if an attack on Pearl Harbor happened, it would be in the form of invasion, and that's what he spent most of his time preparing for). Any landing would have to be supported with reinforcements and supplies, which would have needed to have been sent from the Japanese Empire at the same extreme range as the attack fleet.
Had this hypothetical invasion been successful, the problems would only have mounted. The Japanese would have had to feed the population of Hawaii, which would have involved shipping a lot of food and supplies (and remember, the attack was carried out in large part so that the Japanese could acquire a source of oil). They would have had to fortify the island and keep a large occupation force present, which would have taken troops away from the territory Japan was actually trying to get (and the fleet had enough problems sparing ships for the Pearl Harbor raid in the first place). And, because of its distance, it would have been very easy for the United States to cut Hawaii off and retake it.
So, theoretically an invasion of Hawaii would have been a heavier blow, but it also would have been an albatross around Japan's neck.
(And I'm pretty sure the Japanese Navy knew this - Yamamoto only managed to get the Navy to agree to his Pearl Harbor plan by threatening to resign - most of the Navy thought it was a terrible idea that would not only redirect resources needed for the initial expansion of the empire, but also make a negotiated peace with the United States impossible after the attack. And they were right.)