I don't live in The Valley (tm), but I do live in a tech center (Boston area).
My impression:
The positives: lots of people doing tech entrepreneurial things, lots of talent, other startups to work with and learn from, entrepreneurial culture.
The negatives: I could fill an auditorium with phonies, con artists, and impostors... I suspect that The Valley is even worse. There are lots of "me-too!" ideas, lots of people with enormous egos who don't really know what they're doing, and lots of people who will BS you to try to get you to follow them or do work for them. Being jaded and skeptical is a requirement.
Edit: come to think of it, I have been to conferences and pitch-fest type things in The Valley, and the smell of fast talkers and such was palpable.
So there's lots of good stuff but also lots of noise.