Depends on where in Palo Alto and if you want to walk around or drive to sites/attractions….and what businesses you are visiting. If you stay near University Ave in Palo Alto, you are within walking distance to a plethora or restaurants and shops. Otherwise you are driving to get to just about anything.

If you are looking to not drive into San Francisco, you can take the Caltrain right from near University Ave, into downtown SF.

Other cool “downtown” areas on the Peninsula that have the same kind of attractions as Palo Alto and easy access to SF are Burlingame, Melo Park, and Mountain View. What Palo Alto has going for it is Stanford University.

Palo Alto is pretty central to anywhere in the Bay Area with the exception of North of the Golden Gate or the Far East Bay (Concord, Antioch, Pittsburg).

Ditto adaptable’s response. Even Redwood City has refurbished its downtown and has some good restaurants, cinema, Caltrain Station, etc. although not as much in nice lodging as some other areas. I highly recommend Palo Alto, Menlo Park, and Mountain View for their lodging and dining options as well as proximity to things to do and all have fairly interesting, generally bright and diverse populations.