Firostefani turned out to be a great place to stay. There are good restaurants and access around the halfway point of the walking path that links Fira with Imerovigli. Yet it’s a quieter area, so you can easily get to Fira for the main shopping, restaurants, and nightlife without having to be right in the middle of it. The walk is about 10/15 minutes to either one depending on exactly where you stay.
I didn’t venture out a whole lot, but I did take the bus to Kamari a couple of times. Kamari has a black sand beach and is a nice long stretch with shops and restaurants. A bus leaves from the main depot in Fira about every half hour and costs 1,60 euros each way. I don’t recall the hours exactly, but it started pretty early in the morning and ran pretty late into the evening.
A few places I’d recommend are (you should be able to find them all on Google maps)
Ginger Sushi Lounge – Firostefani
Svoronos Bakery – Fira (next door to the McDonalds)
Villa Fotini – Firostefani