My favourite bar for sitting and people watching in is The Refuge on Oxford Road which is a glorious old hotel bar which was beautifully refurbished a few years ago. It is indoors, but has very high ceilings and plenty of space. Drinks and food are both very nice, a bit more expensive than average but not eye-watering.
If you need to be outdoors, half the northern quarter has been closed off to traffic, and there's loads of outdoor seating shared between all the bars. There's a load around Eastern Bloc, and a load more on Thomas Street. All the bars round there have a decent range, and the atmosphere has always been chilled & buzzing whenever I've been there.
I'll give it some thought and see if anything else occurs...