On the Ave is in a great location on the Upper West Side, a mostly residential neighborhood that will give you a feel for what it's like to live in NYC. I can't comment specifically on the hotel though. Though I once followed Michael Douglass and Catherine Zeta-Jones from brunch nearby to there.

It's also relatively easy for access to Columbia via Subway if you want to go there.

As for tipping, $1 a bag is fine. Restaurants should be 18-20% tip, I say pre-tax but I get into fights with people about that. More or less is fine if the service was particularly good or bad. Taxis - within Manhattan, I usually add $1-2 and round up to the nearest dollar (when paying cash). Ends up being roughly 10-20%.