I love San Felipe... and yes I have heard all of the bad stuff about Mexico. I feel safer in San Felipe than I did in some of the San Diego or LA neighborhoods.
You might consider Pete's Camp if you like to ride OHV, not first class, but a fairly decent place to stay right on the beach. Pete's Camp is just past the El Dorado Ranch/La Ventana Development as you come into town. Baja Mar Restaurant had great service and food on my last visit. I had the large shrimp wrapped in bacon, maybe not the best for my cholesterol level, but yummy and our waiter was very attentive. The little store near Pete's Camp and El Dorado Ranch has excellent food, their breakfast burrito's and sandwich's were fantastic compared to what we get North of the Border, they also carry many of the items that you may be accustomed to in the states. Also the China Inn had great Chinese Food... with salsa and limes on the table???
You should check www.bajanomads.com forum before you get there, search San Felipe and San Felipe Camping, there is a wealth of info there. JH