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More questions about neighborhoods (Canberra)

I'll be moving to Canberra for a 2 year assignment next month and am looking for a place to live. Would like some population density with the ability to walk to shops, restaurants, bars, etc. It will be just me first, followed by my wife and son mid-year '11. Either Apartment or house is fine. I also practice Yoga so access to a choice of Yoga studios/schools would be desirable.

I've also heard that there are bike lanes/trails through the city. True? Do people use bicycles as prime transport? Is the general terrain mostly flat or hilly?

Lots of Q's, I know. Appreciate any help. Thanks.