Betsy, Steven parenthetically mentioned Gimmelwald. While Murren is more quaint that Lauterbrunnen, it is still a Swiss village oriented toward tourism. Gimmelwald, on the other hand, is an agricultural village. The lodging options are Walter's Mittaghorn Hotel, the Mountain Hostel, and Esther's B&B. This is in contrast to Murren which has a number of hotels. If you want a truly authentic Swiss village, Gimmelwald comes closer than any other. There's a reason why Rick Steves regards it so highly. If you want to do hiking, there are trails immediately accessible from either Gimmelwald or Murren. On the other hand, you'd have to take a public conveyance to get to hiking trails from Lauterbrunnen. On the other hand, Lauterbrunnen is more centrally located with easy access to Murren, Wengen, and elsewhere via bus, cog train, and cable car. My personal preference would be for Gimmelwald or Murren over Lauterbrunnen.