I think we're talking about the same area, but there are a bunch of Italian restaurants of varying qualities in a student neighborhood next to (east side of???) the University of Melbourne campus. It's lively and fun, although somewhat touristic at times, but don't expect great food.

South Bank is also very lively and open late, with some good "new Australian" restaurants and wine bars. It's generally more expensive, but you can get some really good food. In some of these places, many of the customers will be fashionably dressed up.