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We started in Fremont, just north of downtown, and though it's become quite "gentrified" since the '90s, it still is a very nice place to live, and Salmon Bay runs between Lake Union and the Sound, so you have lots of water access, as well as the bike trail, and the bus lines to downtown are many. (You WILL want to avoid commuter traffic in Seattle, as much as possible. In fact, soon after moving there, we sold our second car, using our primary vehicle only for grocery trips, and out-of-town travel.)
The atmosphere in Fremont is still "funky." If you are more serious-minded, Queen Anne also has a direct shot to downtown, just south of Fremont, and more upper-class, yuppie. There's less immediate access to water -- it's a HILL, but with a bit of weaving through traffic you can get to either Elliott Bay, or Lake Union.
If you are into gothic/grunge, Capitol Hill is the place to go, the north end has fairly good access to Portage Bay, between Lake Union and Lake Washington - and again is an easy transit commute to downtown, though a bit further than Queen Anne.
If you enjoy ethnic diversity, there are options south of downtown. It used to be a bit scary there, but I understand it's been improved in recent years, and though that water access on the Sound side is industrial, Lake Washington (to the east) is available and very nice. Again, easy access to downtown.
There are a LOT of really great things about Seattle. I loved it, until the congestion got to me. I hope you love it, too.
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