Cafe Lago is a dimly lit rustic italian restaurant right by Montlake Bicycles and 520. It looks nice on the outside, but most people don't think of food in that area, they are probably frustrated from a really lame commute and just want to get home.
Put that aside though and go order yourself a nice glass of red wine and the lasagna. I can guarantee you never tasted a better lasagna. (grandma's excluded)
If that's not your deal, they do have other good options, but at least once check it out. The place is a bit pricey though, so be prepared.