Noticed your less than rave review on the blog. It also got one of Lonely Planet's increasingly rare scathing reviews, although they did note that its greatest asset is that it's got so many nice places close to it. I ventured there only for as long as it took to get a bus ticket (at the time you couldn't do it online without a Chilean ID card number).
Puerto Varas is definitely a better option if you're going through on the way back.
In hindsight it would have been good to avoid it completely (since the airport is well out of town). We will certainly try and stay away when we return the car.