The downtown has a nice pedestrian mall area, with a carefully restored 5&10 store as a centerpiece. There are horse carriages. Along with about a half-dozen fudge/taffy/sweet stores. And the t-shirt emporiums. Hermit crabs are a popular sale item for the kiddies.
But even with all that niceness, Cape May still has that End City feel to it. There is one small supermarket. Unless you are in the military (and therefore eligible to use the Coast Guard PX), you have to leave and drive about 5-10 miles to pretty much get any supplies at a reasonable price. The beaches are enormous and usually packed - it's as far south as you can get and still be in the North. Next stop Delaware. The beaches are well-maintained (groomed nightly) but the rest of the town is looking a little battered. Houses a couple of blocks back from the beach are basically just Levittown-style for the most part.
There are standouts here. Congress Hall is an absolutely spectacular restoration of a turn-of-the-century hotel complex. It's immaculate, and you feel like you should dress up when you step into the lobby. The nightly flag ceremony at Sunset Beach is hokey, but wonderful all the same. There's a terrific bird sanctuary. Cape May County Zoo is a great destination, though it's actually 10 miles back up the road and out of Cape May proper.
But mainly the town is a retreat from the rest of the world - a place where there is no Starbucks (though the lines for coffee are impressive at the Wawa near the marinas), no big-time chain stores outside a small CVS and an Acme, and not much to do other than walk the pedestrian mall, hang out on the promenade or go to the arcades, and sit on the nearly endless beach.
Which is why I've gone there almost every year for the last decade-plus, and despite the traffic getting there will probably continue to do it for years to come. Nothing can be good.