Of course, my biased opinion is Santa Teresa. It has more choices in accommodations, restaurants and is spread out so you don't feel like you have to be a part of everything going on in town. The beaches in Santa Teresa are beautiful and go forever, the sunsets are #1 (Montezuma has no sunsets). You can always rent a car or quad for the day if you are not renting one for your entire stay and check out Montezuma.
Montezuma is definitely central, but you still have to get to the various attractions somehow...not all of them are within walking distance. If you aren't staying in town, you are likely staying up the hill....and it can be a long climb in the heat of the day. If you are into partying, Montezuma is the place to be.