Assisi or Spello as an Umbria base?

Sounds lovely to me! When I am mulling over two close-together places like that, I just start looking at accommodations--that usually will cinch it for me.
Since you said as a first-timer, are you breaking up the trip with a stay closer to the airport on arrival/before departure? That is the kind of thing I mostly see people fail to account for--needing to sleep before embarking on a long drive, etc.

Kellyb, my daughter stayed in San Gemini for a couple of months in college and absolutely loved it. Just a little village that doesn’t get a ton of attention, but she wants to go back there to stay again someday.

We spent a week in Spello a couple of years ago and stayed in a lovely little apartment we found on vrbo.com. It's a beautiful small town with a number of good restaurants, some interesting nearby hikes, and lots of hills in the town. If you're looking for a smallish town to use as a base, it would be worth looking into where you see the same people in the coffee shop, market and restaurants over the course of a week. It's smaller than Assisi and the nearby small towns are readily accessible.

I've stayed in both and prefer Spello as a base with a visit (or two) to Assisi, since you'll have plenty of time. The religious institutions and "downtown" Assisi could be one day and hiking up to the Rocca another. The hermitage could be a third. (I have not been to the latter only because I've never been in that area with a car).

If you want to do a day trip from Spello to another hilltop town in addition to Assisi, consider Spoleto. A few years ago, I took the bus from Spoleto to Spello as a day trip so it will probably still be feasible by bus. Spoleto hosts an international music festival every July which I enjoyed years ago, but I am sure it will be lovely to visit in October. The train station is located in the lower town, so, like other hilltop towns, it's a rather steep walk up to the "centro storico". Enjoy your trip!

We spent two weeks in Spello and highly recommend that you spend some time there. It is a hilltop town and the main street is very walkable passing by shops, restaurants and cafes. It was a very welcoming town with helpful, friendly locals. We stayed up at the top of the town in an apartment. There were several parking lots.
We enjoyed spending a day in Assisi but were glad that we were staying in Spello.

You might want to read the book "Il Bel Centro: A Year in the Beautiful Center" in which the author and her family spent a year in Spello.

We really liked Assisi; but, I couldn’t imagine staying and parking there. We stayed in a nearby resort with parking and easy access to all the roads. This strategy maximized the value of the car. You might consider a similar approach if you plan to do day trips to many locales.

Thank you so much for all the responses. I’ve been leaning Spello as a base. Assisi will definitely be a day trip or 2. Spoleto, Orvieto, possibly Todi are all on the day trip list as well.

We are taking an Umbria tour with Road Scholar that uses Spoleto as its base.

There’s a series of inclined escalators in Spoleto to reach various spots in the historic center. If you’re coming by train, select the ticket with a destination “Spoleto Centro”, and it will include the bus from the train station to one of the bases of the escalators.

I was planning to stay overnight at Spoleto in May, but there was rail construction on the route, so it’s on a future itinerary. Spello is lovely - be ready to walk up steep hills.