It's a tough call. We've considered moving to just outside of Oaxaca City but it would be difficult to give up the superior air connections of GDL and the fantastic climate here. We cope with the traffic by timing going out carefully. Shopping is pretty easy here now thanks to Walmart for the major stuff and a much improved walk to El Torito that has all the other stuff. We like the easy access to the beach from here, although Oaxaca now has that since after 15 years the new road to the coast finally opened.
You would think the crazy high home and rent prices would start to cut the influx but that doesn't seem to be the case although I have been told both sales and rentals have slowed. Development here seems to have shifted from single family or townhouse to NOB style condos, raising density even higher. I don't see how this area is going to avoid a very bad water shortage pretty soon.
Our first challenge is to downsize from a quite large and maintenance intensive property to something more appropriate for people in their 80's. It seems if one doesn't like living jammed up against or on top of/under a bunch of other people the options are pretty limited. This would not be the case in Oaxaca.
The best thing about Oaxaca is we'd be living in Mexico again. 15 years ago this was still sorta Mexico, now not even close.