I think it really depends on what you want.

I personally am not a fan of cave hotels, packed one-by-one to each other, crowded by tourists and not able to drive to the front door. A rental car is essential for me, as I want to explore an island and not sit in one place. I would always prefer to go to the farest away restaurant if it is nicer than the nearest. Walkability is no criteria for me.

So saying this, there is no negative in the location of the Magma. I think the location is even pretty ideal as I can easily access all the spots on the island quickly from there as it is pretty in the middle of the island.

Oia is the best combination of shopping and looks.
Fira is generally rather basic and therefore totally overrun by people but has the nicest view for the sunset.
Inveromigli is the highest end from the restaurant side but has no shops and no real places to walk to.
Pyrgos is more for residents so makes a perfect place to visit if you want to see real live on Santorini.
Amoudi beach is must see and must eat location, but nothing there but fish to eat.