Both. You can manage downtown on foot, as it is fairly compact, but once you want to go anywhere else, you need wheels.
I have some friends that are looking to move to NM. SF was just "too much" (appearently for everything - social, housing, attutude) so they are looking a bit further afield.
Las Lunas and the surrondng area is where they are looking now. They liked Cloudcroft, but after a visit, the deemed it was 'too much' as well.
I had always thought Jemez Springs or Red River would be the nice place to retire to or have a second home.