I've been in Denver for a few years and completed my undergrad at that campus. You can find reasonably priced housing right by campus, but I'd go for a different neighborhood. Capitol Hill is probably the most culturally diverse with lots to do, though personally, I would recommend staying a couple blocks off Colfax Ave. I live a little over a mile south of that, near 1st a few blocks off Broadway, which is near the Baker neighborhood. It's pretty quiet, but there are great coffee shops, used book stores and neighborhood bars. There is the Santa Fe arts district, with some great galleries, but the neighborhood drops off as you go west from there. There's also the Highlands, which is northwest of downtown. Its a bit pricey, but there are great restaurants and lots more. You could probably find a room in either an apartment, or a cool house from the late 1800's in most of those areas starting around $450/mo, but $800 or so should be able to get you something fairly nice.
In Denver you're a 1 to 2 hour drive from world class skiing, hiking, mountain biking and all kinds of great outdoor activities. If you don't own a car, you can probably find rides with people to do stuff in the Mountains. While I would recommend owning a car, the transit is better than most US cities and a school ID gets you free light rail and bus. I only use my car once or twice a week and I could get by without it if I really wanted to. The light rail goes right by campus, as does the Cherry Creek bike trail and numerous bus routes. Campus parking is expensive and long walk from academic buildings, so its actually faster and cheaper to use mass transit or ride a bike.
Denver has mild weather. Snow rarely stays on the ground for more than a few days and average winter temps are in the 40's. There is a massive snowstorm once every two years. Summer is sunny, but its not that humid and rarely hits 100 (though its been hot lately. I don't like it when it hits 90). Rain usually doesn't last very long but can be very hard, and there is occasional hail.
Denver is a good food city (much better than LA where I lived for 2 years). The cuisine is influenced by New Mexico with great roasted and smoked peppers, but with the added advantage of being the most cosmopolitan place between Chicago and San Francisco. Hole in the wall Mexican food is cheap and good, and there are lots of nice restaurants. Also, I believe that Colorado microbrews are the best beers in the world. Most of them are not available outside the state. The music scene is so-so, but not bad. Boulder is about a half hour away, which is an actual college town and is worth checking out. A lot of UCD faculty live there.
