Generally speaking, the reason Olympia gets on certain national lists as being a good place is that its relatively cheap to live here, because of government our employment levels are stable (generally), there is a lot of culture here for the size of the city (thanks to the state government and Evergreen), temperate weather and pretty geography.
I avoid Olympia proper as much as I possibly can. I don't shop there and I try to avoid dining there if I can think of an alternative. Why? The place is an arm pit and has become more so in line with the volume of the "We hate America" crowd that infests downtown and nearby areas.
The reason Andy hates downtown Olympia is because a lot of liberals hang out down there and there is graffiti. Makes sense to me, people oftentimes make decisions where to be based on politics and how their politics inform their culture.
Far be it from Andy to shop at Einmaleins, that anti-American shop owned by a German! (By the way, that's a joke. In my mind there is no more pro-American shop than Mathias' place.)
Anyway, it makes sense because so many people make the same decisions. Read a great series by the Austin American-Statesmen on the Great Divide phenomena here. Generally speaking, it says people choose where they live by Andy's standards: do you agree with me, do you like the stuff I like.
So, for the very reason Andy hates downtown Olympia, a lot of people simply love it. They love the liberal to radical politics of our geography, they love things like graffiti art (a portion of it is art) and Procession.
The Kiplinger's rating has nothing to do with taste, but rather other, less subjective standards. Other than, I guess, the presence or absence of culture.
All that said, Andy is right. Olympia is a total hole. Crap hole filled with dung heaped with bad food and smelly people. Don't move here. Just send envelopes of cash. Thanks!