As someone who was born and raised in Bolinas (22 years living there), I must say that it is one of the best towns to live in. Of course everything in this post might be a bit biased, but if you just give the town some time, it will grow on you.
Where do I start though? There's so much!
The commute to San Francisco is anywhere from forty five minutes to an hour long drive (depending on how fast or slow you drive

). The amazing scenery along Highway One makes up for the drive though. You can catch glimpses of beautiful sunrises and sunsets and even the occasional wild animal (owl, rabbit, deer, coyote, bobcat, quail, etc.).
The atmosphere in Bolinas is, in my opinion, very welcoming. As long as you treat the town and the locals with respect and honesty, they will be more than happy to welcome you into their community.
As for the whole "sign being torn down" thing? That was a long time ago. I believe the last sign to Bolinas to be taken down was in the early 90's. After that California Transit gave up trying to put up another sign. Bolinas originally started out as a small fishing village. Hippies from Berkeley and San Francisco eventually ended up managing and "taking over" the town in the 70's (?) during an oil spill in the San Francisco Bay. The then rebellious locals did try their best to keep the town to themselves, any way possible.
Bolinas today is almost the exact opposite of what it was then. The town is fueled by tourism. Every summer during the weekends the "downtown scene" becomes a nightmare with parking and swarms of "outsiders" crowding the streets and only beach. Many houses are now considered "summer homes" and sit vacant or rented out for most of the year.
Bolinas has literally turned against itself. By trying to kept to itself, it has inevitably become a tourist attraction.
The "festival" held every year, I guess would have to be the 4th of July Parade, which consists of a Tug O' War across the channel between Stinson Beach and Bolinas, a small parade containing creative floats and dancers, and a big BBQ held in the middle of downtown.
There are several festivals and events that take place in Bolinas each year. Just to name a couple, there is the annual Labor Day BBQ (great local food!) and the Christmas Faire (great local crafts!).
The weather (from what I remember) is mostly foggy (late Fall through early-late Spring), with a few sunny days (late summer through early Fall). The temperature is moderate, anywhere from the low 40's (we got snow one year, snow on the beach!) to the high 80's. Storm season (mid winter) was always my favorite, as I would love to go down to the beach and watch the HUGE waves crash along the sea walls.
If you want a small, tightly knit community feel and a place to just "get away from it all", than Bolinas is the place for you!
If anyone has any questions on this town, feel free to ask, I'll have the answers!
Also, you might want to check out this site, it has a bit of info on Bolinas in the now: Bolinas 2 Miles News & Information (broken link)