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She has heard that there is a large amount of drug deals and prostution going on in town as well as breakins at hotels and into vehicles. The things you speak of could happen in any of the touristed areas in Costa Rica.
I take normal precautions not paranoid and I have never felt unsafe personaly in the area. Prostitution is legal in Costa Rica so it is possible you might see prostitutes. I do not go looking for drugs and no one has ever tried to sell me anything in PV. I love the food, beaches, music, climate and nature of this very pleasant corner of the world. I would not be overly concerned I never saw a prostitute while I was there and I was out till 3am each night.
Also never saw any drug dealing. Just take the normal precautions you would anywhere. I agree theft is a problem but it is all petty theft, not dangerous hold ups or robberies. There were plenty of families and couples everywhere I went in PV. Well, I am going to be very honest with you as I live here in Puerto Viejo. If that is what your wife is concerned about, then she should really not travel anywhere in Costa Rica.
Yes, there are prostitutes in Puerto Viejo. They are usually right at the entrance to the town. Most are drug addicted and it is very sad. I do not see them really harass anyone, so I can not see why they would bother you and your wife.
Yes, there are drugs in Puerto Viejo. Marijuana is smoked openly and sold very openly. It is part of the culture of many locals and most me included don't really see an issue with it. As for other drugs, yes, cocaine especially crack is also a problem. Being that we are on the Caribbean , there seems to be a pipeline of drug smuggling all the way from Columbia to Limon. Most of it is done by sea. The chances of you actually witnessing any type of this activity are extremely rare. Yes, there is crime.