As far as places to hang...I don't know exactly what you are into, but I can say I don't recommend Water Street for all of the aforementioned reasons! You might like place on the Eastside like Mantra Lounge, Cush, Dragon Lounge, and BBCs!! If you are into a more artsy crowd with interesting roots down live music check out ONOPA Brewery (a brewpub in Riverwest with pretty good live shows)!
As far as places to eat....Milwaukee has a lot of cool restaurants...
Prime Quarter...a place where you pick out and grill your own meat (reasonably priced)
Safehouse is a fun theme restaurant to go to on a weekend night before going out
Kopps...has great butterburgers and awesome awesome awesome frozen custard (beware if you are lactose intolerant ;-)
The African Hut on 3rd street (fun place to dry mostly West African food and drinks....
www.africanpresentations.com)
La Perla, La Fuentes...good mex and good margis
I have to admit though...most people really seem to enjoy it here in the summer when there is festival after festival after festival and the BREW is put back into BREWTOWN!!!
Oh and the brewery tours are fun to check out the best one is the one on the Riverfront called the Lakefront Brewery....Miller tour is alright, and the Sprecher Brewery tour is fun!!!
Good luck,
PUZZLEBOX