Cman, opinions will differ. It all depends on your priorities and specific requirements:
1) If you want to settle down and have kids, go buy a nice house in San Marino or La Canada. Being near Caltech and JLP(NASA), these school districts are the best and second best, respectively, in the entire state.
2) If you want to live in a safe, urban neighborhood that is along the Metro rail, look at the Old Town Pasadena area.
3) If you are a good cook and do a lot of it, keep in mind that the largest farmers market in LA is nearby in South Pasadena (also along the Metro rail).
4) LA downtown is nice if you are thinking of one of the new condos.
5) USC is a bad area. Dont live there, unless the wife hails from Oakland (no, I'm not referring to the part of Oakland bordering Berkeley).
6) Smog is a problem. The aforementioned San Gabriel mountains only show themselves in late December, or when the Santa Ana winds blow. If you wnat to live a few years longer, check out the coastal communities on the west side of town. Beware though, places like Long Beach can actually have worst air than places like Culver City.
7) Try to minimize your carbon footprint. Lots of places are accessible via Metro: Staples Center, LA Convention Center, Pantages, Kodak Theater, Hollywood Bowl, etc.