Davis gets a bad rap, but it's mostly from people who have never been there.
I loved my experience as an undergrad. The town is very suburban despite its undeserved reputation as a rural school. You can see Sacramento in the horizon from many town locations. It's apparently the second most educated town in the country, but I am unsure of the metric. The families who live here are very open and very friendly green-liberal-types. The town has gone out of its way to maintain a "progressive small town"feel.
There are many nice scenic walks and bike rides around town. The bike culture here is insane. If you are into bikes as I am, then you will be in heaven. I read a map once and the map showed that the town had more than 40 (!) parks where you bike around, walk, play softball, etc. Nice restaurants. Walking downtown is pleasant.
Weather: Varies between two extremes by California standards. Summer months are hot and dry (85-95deg av) and winters are cold and rainy (40s-50s days, 30s nights).
Where to go: I've lived in the Bay Area for all of my life, and many exciting things are in driving distance. San Francisco is 1.5 hours southwest, Sacramento is 15 minutes east, Napa range (for hiking) is 1 hour west, Napa valley is 1.5? hours west, the Sierras are 1.5 hours northeast, and Reno is 2.5 hours northeast. Indian casinos are within an hour by car.
Housing: The most expensive area is South Davis. North Davis is next. Students usually populate these two areas because these areas have shopping centers. West and East Davis are both in the lower in price, quieter, and less obnoxious (in my opinion). If you want to bike to campus, then live in South Davis or West Davis. These two areas have long, dedicated straightaway bike paths. You can bike to campus from just about everywhere since every street connects to a small bike path. Most people overestimate how often they will bike to campus, though, since the weather is rarely "perfect".
Houses are usually available but are variable in quality. Some of my friends had bad experiences with landlords trying to rip them off.