I'm not there as frequently as I used to be since I became a Dad, but here's my take on a few of the recommendations so far:
Mangia Mangia - The only spot in the Keys where I have had a memorable wine experience. The Keys are designed to be laid back, so don't go expecting to be sniffing from a Riedel. I'm sure you can get Riedel somewhere down there if you try hard enough, but if you do you are kind of missing the whole point of the place to begin with. Therefore, Mangia Mangia is a laid back wine experience. The cellar (and maybe the restaurant) is owned by a wine lover, clear and simple. He's got a huge list at bargain basement prices. So low that he refuses to sell wines to-go. If you want to buy it, you have to drink it. Make sure you get a tour of the "cellar." It's a couple of rooms in a couple of houses, really wild. The food is basic Italian, the best seats are outside, but you're going in August.
Cafe de Artistes - I've eaten there twice, once with great success and once without. The one with success was over ten years ago.
Louis Backyard - Once the hallmark of Key's innovation, this venerable landmark has long lost its original luster, with the chef that gave the place its glitter long departed (try Norman's in Coral Gables) and service and quality back to Key West traditional standards, which isn't saying much.
So what to do? - As you might be able to tell from my comments so far, things don't stay the same for very long down in the Keys. Your basic hospitality staff isn't exactly thrilled to have to be working, they don't earn enough to afford to live there, and the simple fact that they are there hints at some sort of an unresolved inner turmoil to begin with. You can go to some of the national hotels that have bought property there and get a decent meal, but Key West without the "spice" isn't really Key West. And the "spice" doesn't do corporate.
Ask for local suggestions, and lots of them. If you can find a foodie or wino youll have it made. Id suggest seeking out a place that will include the chefs name Alice, maybe at LaTeDas but she might have moved, for some innovative cuisine. Dont expect a lot from the wine list wherever she is, but her food should still be worth a bang for your buck.
BTW BYO isnt a problem down there. Also, August is VERY quiet, with the exception of a few German tourists (they are the really red ones). Its the Keys, roll with it.
It's late for me, I hope this post makes sense and/or helps.