In a perfect world, I'd live in a land where there are four seasons (just not in one week!), but not extreme on either end. Further, I'd want a place where it doesn't rain all the time, either (so Seattle is out).
That's me as well, though I'd kind of like to avoid Tornado Alley and major fault lines too!
(ETA - and probably Chicago, if its nickname is accurate - It's really windy here right now, and someplace that was like this all the time would drive me nuts!)
Anyway, I'm happy in Massachusetts right now, but might consider someplace warmer when I'm older. I'd love to retire near Walt Disney Word and start some sort of organization that takes poor kids from the area to the parks. Maybe all the schools go or something, so it wouldn't be needed - but with the prices, I've often wondered if there are a lot of kids who live so close but don't get to go?
My other retirement criteria will depend on whether I have grandchildren someday. I'm sure I'll want to be close to them if I do!!
As for the original criteria:
Climate? Activities? Close to family?
We definitely determined where we moved after college by proximity to family. We wanted to be near either mine or DH's, and the job were better near his, so that's where we chose.
I can go either way with activities. I went from a very rural sort of place to one with quick access to a big city, and found that I really love both! (Though it
would be hard to give up the easy drive to the beach now.)
As for climate, I definitely need my sunny days, but they don't have to be warm all year round (at least for now, when I can still shovel snow). I love the change of seasons, and always seem to be ready for the next one by the time it comes!