if you like the touristy stuff then most of it is above 23rd street. if you're into the more local hangs and "cooler" places to go for dinner and night life then i would stay in the greenwich village area's. east village and lower east side probably have the least amount of typical tourist crowds and these are the area's where i mostly hang.
soho's a great area for shopping and great food. a bit pricey but very good and the typical "sex and the city" restaurants. best thing to do is walk around these area's i just mentioned and you will find the coolest little boutique's and quaint little cafe's and bars. not many cafe's in general in the times square area
you can spend a whole day just walking within a 3 block radius and have a choice of any ethnic food you could think of, from ethiopian, afghany, japanese to good ol american.
for even more she she nightlife, the meat packing district has now become the big fashion area. good for a night out for sort of vegas type of clubs. the gaansevoort (not sure about the spelling) hotel has a cool rooftop club. like i said, could be good for a night out.
and there's always central park but in december it will be cold to walk around. don't forget all the great museums we have! the MOMA, Guggenhiem, museum of natural history, etc
good luck. PM me if you're going to be in the village/soho/noho area's and want some recommendations for food and places to hang. zagat's a decent gauge but not the "end all" by any means. i've been hanging out and living in those neighborhood's most of my life. we could grab a drink or espresso if i'm in town