Keep the Neighborhood Italian Restaurants Coming
I also like Le Zie on 7th Ave b/w 20th & 21st (212-206-8686), although I haven't been in a couple of years. I used to love the rigatoni w/ rosemary veal ragout ($10.95). They have a sister restaurant, Via delle Zoccolette on Ave A & 6th (212-260-6660). If you just order the grilled ribeye with white truffle oil ($15.95), you don't need to eat anything else.
Cacio e Pepe on 2nd Ave b/w 11th & 12th (212-505-5931) is also good, although their average prices may be a titch too high to get 2 courses + glass of wine for $25. The restaurant is full of Italians (staff and guests), always a good sign. Bar Veloce (212-260-3200) across the street is similar, though not as good as, 'inoteca, with a salumi/cheese/panini menu.
We also recently discovered Uva on 2nd Ave b/w 77th & 78th (212-472-4552) and had a nice brunch, and the rest of the menu looks intriguing.
I don't know if this counts as "neighborhood," but the best cheap Italian place in my book is Otto on 5th Ave & 8th St (212-988-1188). Their spaghetti carbonara is the most authentic I've had in NYC (no cream!), and for only $9.
Reviews of all of these restaurants here.

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