Hello, I will help as much as a I can for some thoughts but my knowledge is not amazingly up to date. I live in the UK but grew up on the Isle of Man, my parents moved there when I was 5 and I did all my schooling over there. My parents, sister and two brothers live there still, my sister has two children but they are preschoolers.
One of the key factors in my parents moving over there were the schools, they are good, mostly with small class sizes (there were 17 in mine, but I think 25 would be considered quite large).
The Island is only 33 miles from end to end, we grew up in the south of the Island in Port Erin which is a lovely area, so even from furthest south the hospital takes about 25-30 minutes, you certainly don't get the same sort of traffic you get over here.
In the South the schools are (from South upwards), Rushen (big primary school in Port Erin but a good reputation, split infant and junior), Port St Mary (Scooil Phurt le Moirrey - a lovely school, very small class sizes, typically 12-15), Victoria Road in Castletown (would probably avoid, Castletown is a nice area but this school draws from a bit of a mixed area, it's the only Castletown school though), Arbory in Colby/Ballabeg, again a lovely school with small class sizes, Ballasalla (I went to this school, again it's quite small and has a good reputation, but has a slightly mixed area, better than Vic Road). The secondary in Castletown is where my brother goes and where I went, it used to be a great school and does well, but it has recently lost it's head who was very unpopular, the school is not as good as it used to be but that may now change).
A really nice area, and where I would live should I move to the Island, is St Johns, the primary school is nice, it's about 15 minutes from Douglas, and the secondary school in Peel is the best on the Island (QEII). There's another big primary in Peel called Peel Clothworkers, I don't really know what it's like but you could google it, I think Peel is quite a nice area.
Even closer to Douglas is a place called Onchan which is quite a nice area, really close to Douglas (and close to the hospital) and I think it has two schools, Onchan, and Ashley Hill. You would have to research them as I don't know them well, I have a feeling Onchan has the better reputation but that is probably about 10 years ago (or more, I'm 32 !!) There's also Scooil Vallajeelt (a few schools have Manx names) and I know the Head there taught my brother and he was great, I think that is a nice school, it's draws from a nice, family type area). Schools to avoid are Anagh Coar (on one of the two big nasty estates in Douglas), Manor Park (on the other one !) and I think Murray's Road has a bit of a dodgy reputation but I might be judging it unfairly. There are small schools called Braddan, Kewaigue and a few others too, I can't recall them all !! There are two secondary schools in Douglas called St Ninians and Ballakermeen, I did A levels at Ballakermeen but St Ninians is the better school (or it used to be, it's all relative, all the secondary schools on the Island would be considered good here).
Up north Kirk Michael is a nice area and has a primary school, and further north still is Ramsey which I don't really know. It has a secondary school which is good, I wouldn't know the primary schools, I think there is Maughold but a bigger one too, I can't remember what it's called (don't live up North, there's nothing there !)
So, my top recommendations would be in the South (Rushen, Port St Mary school, or Arbory as a preference but I do know these schools better), in St Johns, possibly Peel, or in Douglas then Onchan.
Drop me an email if you need more help as I have three good friends there who are primary school teachers and my sister lives there too so I can pick her brains (as well as my parents) which will be very up to date. My email is helencw [@] fsmail [dot] net
My dh was offered a job there two years ago which he accepted but then turned down because I got cold feet (I have lots of friends here), I know a lot of people think the Island is in the middle of nowhere and is a damp rock, but it's a fantastic place for children, great schools, very little crime, great community spirit and there is a reasonable amount to do (maybe not so for teenagers).
Good luck, I'm sure that must be other Manx people here who can help you out more specifically with other areas !!
Helen