These guys have covered a lot of the suggestions I would make. But a few more ideas:
Hit one of the caribbean roti shops on Queen St. for a cheap and delicious lunch.
Bar Italia on College St. has great food at reasonable prices.
Korean food on Bloor and Christie!!!
The Golden Turtle on Ossington for Vietnamese food.
Soundscapes on College St. (near Manning) is a great great store (CDs only, but well worth it if you're in the neighbourhood).
Balfour Books is almost directly across the street from Soundscapes and is one of the best used bookstores in the city.
Utopia (also College St.) is a good veggie-friendly hipster pub-type restaurant.
Ossington St. has become the newest fashionable eating and drinking area. It's happened since I left Toronto, so I can't really make any specific reccomendations.
If you're there on a Saturday (they're only open Saturdays) PLEASE go to the
Ydessa Hendeles Art Foundation. It is a small gallery owned and run by the biggest modern art collector in Canada. It always has really cool stuff there.
Art Metropole, which sells artist's books, is practically next door. There are also many nice galleries along Queen St. around Ossington. (I reccomend
Katherine Mulherin's galleries, especially.)
I think Crumbum's right about the East end. I almost never ventured that way even though I lived in Toronto for 10 years, but did find some good records out that way.