I live in Baltimore although I'm still waiting to hear from UMD. The best neighborhood to live in as a student at UMD is Federal Hill. It's one of the safest and most fun neighborhoods in Baltimore (lots of young people/good bars and restaurants), and there's a shuttle that will take you to the med school. I wouldn't recommend living downtown or in the area around the med school as it's relatively unsafe at night (especially around Lexington Market) and the rents are still in the same range as Fed Hill. Mount Vernon isn't bad either (north of the Washington Monument on Charles Street) - it's kind of a long walk though, and I'm not sure if there is a UMD shuttle that goes that way. Fed is your best bet. Do NOT under any circumstances look at living west of MLK.
PS, Fed Hill is defined as the neighborhood south and west of Key Highway, north of Randall Street, and east of Hanover Street. It's all south of Camden Yards and east of M&T Stadium (and within walking distance of both, which is nice).