First of all, I am not a big fan of Spanish food, maybe because I haven't been to any place really extraordinary. I have been to La Paella (9th St. and 3rd Ave. on Tokyo row) a few times with mixed reviews. The first time I found it passable though the paella was a little dry. The sangria was lovely and very drinkable.
I went again about 2 weeks ago (under protest, but everyone else wanted to go) and it was excellent. We got a lot of tapas this time in addition to the paella. The tapas was wonderful (especially the two seviche dishes we got) and varied. We shared the seafood paella and it was much better than the last time. It was much moister this time tho two of the party said that the rice was a little undercooked.
The atmosphere is quite boisterous, but a little quieter downstairs. Try to avoid getting a table upstairs near the door; the traffic is crazy and the icy blast (during winter) from the door opening and closing is off-putting. Enjoy and report back on what you find!