"What do you like?"
Translation:आपको क्या पसंद है?
Here है is translating with पसंद.
The sentence is literally "To you, what like is?" but try to think of it more as "To you, what is that-which-is-likable?". You can see that it is not 'you' which 'is', but rather 'that-which-is-likable' (पसंद).
EDIT: I wasn't quite right, see below.
Nice explanation zeebo7. Just a little correction: The sentence uses है as opposed to हैं because of क्या, which is the subject of the sentence. In other words, as illustrated in the following examples, the verb agrees with the subject.
मुझे यह पसंद है। - I like this. (To me, this is likeable.)
मुझे किताबें पसंद हैं। - I like books. (To me, books are likeable.)
तुम्हें क्या पसंद है? - What do you like? (To you, what is likeable?)
तुम मुझे पसंद हो। (Also, मुझे तुम पसंद हो।) - I like you. (To me, you are likeable.)
क्या मैं उसे पसंद हूँ? - Does (s)he like me? (Am I, to him/her, likeable?)