I would only use Duval street as a transportation route, but I would not eat at any of the restaraunts there (overpriced and the food is not so good) and too many tacky t-shirt shops. I didnt really see anything special there.
Fun Alternatives: If you want to find the good restaraunts go to the streets directly to the south or north of duval street (whitehead and simonton streets)
OK, sometimes there's a reason an area becomes a trap: this is where most of the action is. But, there are a lot of great places in Key West that are not along Duval Street.....
Unique Suggestions: There are some great places along Duval: La Te Da (restaurant) comes to mind and lots of shops, shops, shops....
Fun Alternatives: I wouldn't want to stay right on Duval...too noisy ...too many people. Do check out the smaller inns and hotels just a few blocks back. And, don't be afraid to walk to the restaurants that are scattered all thoughout Old Town...we did plenty of walking at night and didn't have any problems.
Most of the bars on Duval Street are technically 'tourist traps'. Buy mixed drinks from the smaller, less commercial bars, otherwise you pay $6.00 a drink for a teaspoon of alcohol. Margaritaville had expensive, but good drinks.
Hog's Breath Saloon was good, but a tourist trap. If you have a limited amount of time pick some of the other bars.
Key West does have small bars off of Duval Street that are not crowded. I ate lunch at a Irish Pub that was off the beaten path and it was worth it.
Sloppy Joe's... The bar that is in Hemingways books. This is NOT the bar where he wrote the books at.