I agree--Ballston and Clarendon are great areas in Arlington, but so is East Falls Church, if you're looking for a house, and it's still within a few miles of DC. Our house is in Silver Spring and nearly doubled in value from 2003-2006. We're renting it now: $2800/month for a three bedroom house with huge yard, walking distance to SS Metro and all the downtown SS shops. But that is considered high for the area (one with lots of bungalows and old farmhouses...not the area of Silver Spring that has the old colonial/brick house look--lesser known, more expensive area!).
Think about looking on Craig's List for a shared house or something--my sister found roommates that way, as have many other people I know.
South East DC on Capitol Hill is once again a trendy place to live, especially near Eastern Market. Lots of fun bars and artist markets down there--we tried to buy a house there but were outbid every time--it's still quite popular. Relatively high crime still, but also more and more gentrification and therefore maybe a lot of people in the same situation to look out for one another--higher income folks looking for a fun and central place to live that isn't Bethesda or Dupont. Adams Morgan and Dupont are also funky areas, more expensive of course--too expensive, in my opinion. But loads of artists and writers I know live there, and they're broke, so there must be some secret to it...I think it's finding a roommate who has lived in a place for a while where the rent rate is 5 years old. Not exactly rent control, but close.
Lots of people have been moving into the Mount Pleasant area, but again--you'd want to have a car to be there because I wouldn't walk home alone from that Metro stop if you paid me. Areas near Tenleytown and Cleveland Park are also quite central (those are on the Red Line). When deciding if a place was too scary for us to live (in terms of crime), a lot of the time I simply went with my gut--how did I feel driving around the neighborhood? You can tell--cafes with lights at night or decrepit buildings and lots of dark alleyways.
I'm not a fan of places like Shady Grove because they're far out--if you want to enjoy the city, you probably won't bother going in if you live out there. Recently there have been some development projects (nice looking ones) in proper downtown DC, near Metro Center and Chinatown, just north of the National Mall. Oh, and about Ballston: we got an incredibly cheap apartment there; a lot of the buildings are small brick two-story buildings that look like they used to be part of a college or something. We had roaches there, but I think that was because of the people who lived down below and were running a pupuseria out of their kitchen. Couldn't have been due to my housekeeping skills!

One tip on the car thing: if you think you only need a car occasionally for running errands, etc., lots of people who live centrally use Zip Car, and it's worked really well for them. Good luck!
EDIT: oops! just read someone else's post about zip car and craig's list. oh well--doesn't hurt to reiterate!