Otto's is a great little bar/restaurant just outside of State College "proper". They make their own beers and serve local wines from the Nittany Winery.
They have a great bar area, a dining room, and very pleasant outdoor seating. Some of the servers could improve on their customer service skills, but for the most part they are knowledgeable of both their beer and food offerings.
I am not a big fan of very dark beers, so I haven't tried anything on that end of the spectrum, but have friends who love the ones at Otto's (particularly a coffee stout that is only offered a few times a year). I have been very pleased with the pale ales and lighter beers that I've tried and I'm sure I will be investing in an Otto's Growler soon. Also, they make a "red wine slushies" using the Nittany Red and it is great when you aren't up for a high alcohol content beer.
The food menu is a bit eclectic, with a fair amount of vegetarian offerings as well as a good mix of recipes featuring local produce, cheeses, etc.
Otto's is a great alternative when you want to get away from the frat boy feel that often embodies Happy Valley.