Having lived in a few different places here are my thoughts:
London-not in a million years, lived there off and on for nearly six years. The people are unhappy, their mainly English, the weather is awful, it's stunningly expensive, leading to a poor quality of life unless you earn a very large salary.
Prague-A truly wonderful place and can still be affordable. Transport links not as good as a major centre, but Ruznye is an efficient easily accessed airport with good if not great connections to big cities.
Lyon-Great location, close to mountains, not far from the sea, close to Burgundy and renowned to have the best food in France. The French are fine once they know you aren't English.
Bilbao-The best food in Spain, even the Castillians, and Catalans admit this, great beaches, and hills, reasonable connections to major cities.
There are many other smaller cities I would choose over London, Paris etc. Mainly because big European cities can be very expensive, and the charm of these places can wear off. I think the best of Europe can be found in provincial cities.
I plan on living in Europe after my stint in the US, my first choice is Lyon, although somewhere on the coast is also high on the list. Other countries of preferance include Slovenia, Croatia, Italy, Portugal.