I will give props to Sojourner. Rapallo is pretty awesome. The weather has been great and the views of the sea are spectacular. We found a couple good restaurants when we first got here, and the market is not too far from the apartment for those days when we want to eat in. There's not a lot to do, which is OK by me but harder for the kids.
I think I would enjoy living here, though Dubrovnik remains a contender for my affections. Really, what I think I would enjoy is having a home base in one of these Mediterranean cities, and a beautiful sailboat I could use to wend my way around the coast, from France to Italy to Croatia. Alas, I am the only sailor in the family so I don't see that happening.