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Well, I don't have school aged kids... but since no one has jumped in yet...
There are some really good grade schools in the greater Olympia area. I am very familiar with Boston Harbor elementary school and know parents that are very happy with it... it is one of the reasons they chose the Boston Harbor area of Olympia.
In the Olympia, Tumwater, Lacey and Yelm area, I think you will be able to find what you are looking for. I prefer a little more rural with city conveniences within a 15 to 20 minute drive.
As far as diversity, I would say Olympia proper would be your choice hands down. A lot of the diversity is due to Olympia being the capital city of Washington and don't forget Evergreen college... which is well known for it's diversity.
You might want to start reading the online edition of "The Olympian" newspaper. Lots of info in there on events going on around the community.
Good Luck with your search...
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