I went to LA84. We stayed in Santa Monica which wasn't a bad central spot. We did have a car and drove almost everywhere. The big venues (Santa Anita, velodrome, UCLA, USC, basketball arena) had parking, or shuttle lots. Don't know if they will be doing that as much this year since they have a better transit system. We did the budget tickets; mostly seeing prelims (often in the morning) which left afternoon for playing tourist. I agree that Long Beach looks like a good spot to stay this time as there are lots of events there. Or focus on what you absolutely have to see and stay near there. In 84 the locals mostly stayed home or left town so traffic wan't too bad.
Also focus on what is great to see live and what is better on the tube. Or go to events in big arenas, where you are more likely to get tickets. Pick some of the more obscure sports. We saw basketball, volleyball, swimming, equestrian, track cycling, and track & field (the first woman's marathon!), 1 event per day except track where we did morning and afternoon sessions. They are also drawing out the length of sessions so they run longer, meaning fewer events per day, but that means more days to see something.
It really was a once in a lifetime experience - hopefully twice for me if the tickets and travel work out - so try to go if you can, even if just for a few events.