Well, one could very well go there to be working with the tourists and short term residents...

I had the same question. I visited Venice years ago, and though I definitely think the place deserves to be on people's bucket list (it's beautiful, an engineering marvel, and I kept thinking to myself "How can this place still exist?"), but it still felt like "adult Disneyland" - more a museum almost than a place to live.

Genuinely curious about what life is like living there, and what the draw would be to move there.

There's many different kinds of experience to be had in Venice. If someone comes as part of a tour group, and their Italian is limited to 'grat-see', then yeah, they're 100% going to have a particular kind of experience (for which "adult Disneyland" is a great label). The stretch between the Rialto and Piazza San Marco, inclusive, is 100% for tourists. Some other stretches are heavily touristy too these days - the seaside walk between Piazza San Marco and Arsenale, the isles of Burano & Murano, etc. This is really no different from a place like Prague, where the historic heart is also 100% for tourists.

There's other places in Venice though - quieter parts, less touristy streets. You see fewer selfie sticks and more people with grocery bags, you see lawyers' offices and dentists, you see cafés selling coffees for more reasonable prices, etc. I would imagine that there would be beautiful charm to living off the beaten path in Venice, strolling along the canals every time you want to go for walk. If you're someone who greatly values beauty, paying Venice's cost of living premium in exchange for that privilege might feel like a good deal.

100%. All it takes is the ability to use one's legs ...

In Venice, the small local population amidst a substantial influx of tourists fosters a tighter community.

Actually, lots of extremely local communities gather around social hubs, typically squares featuring bars where people routinely visit for breakfast, brunch, and aperitifs. It doesn't take long to gain recognition and differentiate yourself from a tourist; alcohol often facilitates conversation, too :).

If you want to see this in action, there are a fair number of sagre (these are summer festivals typical of small towns and villages throughout Italy, but not so much in the cities) that unfold right in the heart of Venice each year! (Try searching for Festa de san piero de casteo or Sagra di san giacomo dall'orio and look at some pictures)

Moreover, as Venice doesn't have cars (and boats just work in a different way), you're likely to follow the same few paths to and from work. This familiarity aids in establishing recognition on the street.

Being young can be beneficial when integrating with locals, thanks to the significant student population residing in the city (relative to the number of permanent residents). However, it's hardly an impediment; it's common to see people of all ages enjoying drinks during aperitivo. YMMV depending on your level of introversion or extroversion.

Nightlife after midnight is concentrated in a few places, and again it won't take long to recognize the same faces, nor to be recognized too.

Overall, as a single data-point, during my seven years there, I found Venice's social dynamics to touch a sweet spot in its unique blending of small-town camaraderie and large-scale artistic events.