The Blue Hole is a natural bottom fed spring with clear water. It is bell shaped with the top of it starting at about 60 foot across and fans out to about 120 feet. The Maximum depth is 82 feet. There is a cave entrance that the water comes from, but the cave entrance is grated up so that divers can not get into the cave system.
The visibility really depends on how many people are at the Blue Hole. During the week and early in the morning you can have limitless visibility and be able to see the entire thing end to end, but when classes and "cliff jumpers" are at the Blue Hole then the visibility can dwindle pretty quickly. That problem should be some what better though as the Army Corp of Engineers spend weekdays for two months dredging out the silt and removing some of the rock from the bottom of the Blue Hole. On July 4 I was there and was one of the first divers in the hole that day and the visibility rocked. As the jumpers came and started swimming and jumping into the hole the visibility started getting worse. You could see silt clouds just exploding at the surface, but the visibility below 30 feet was still very good. Being as the water flows from bottom up, the silt didn't fall very far before being washed out.
There are two entrances, well three if you want to take a giant stride from about 12-15 feet up.
There is a giant stride platform that is about 6 feet high from the water and there is also entry via the stairs.
Water temperature is supposed to be 62 degree's year round. From personal experience the water temperature will be mid to high 50's in the winter and low to mid 60's in the summer.
Permits cost $8 per week or $25 per year. You can get permits from city hall, but they aren't open on the weekend and the city rarely has a code enforcement officer at the Blue Hole on the weekend.
http://www.santarosanm.org/permit_application.doc
The link is a permit form. Download the form, print it off, fill it completely out, except the date and put it into your log book. Bring cash or a check book and if you happen to see a code enforcement officer there then give him the form and money. If you don't then don't worry about it.
The only other local lake I've doven in is Perch Lake. It's about 60 feet deep and in the summer the visibility can be anywhere from 2 - 20 feet. There isn't much in the way of life, but there is a sunkan plane, car, and other sunken obsticles. The surface temperature is around 80 degree's with a thermocline at around 33 feet that can drop down to the low 70's to high 60's in the summer. In the winter the water temperature is low to mid 40's.
As far as the 'surrounding' area. It's the desert in a small town. If you are into hiking or archaeology then it will be a really cool area, but other wise it's best to keep to the diving.
You can also dive in Lake Conchas and Ute Lake less than an hour away, which are both pretty cool dives if you like lake diving.
Here are some pictures that my buddy took when we went on July 4:
http://www.securitygeek.net/gallery/Blue_Hole_July4-2006