There will be crime anywhere, I would take the poster's caution in mind in terms of your conduct, but Esteli is no more or less dangerous than other cities in Nicaragua, and certainly safer than Managua. Lots of medical mission trips, etc opt for Esteli, I´ve heard nothing but great things about the city (I myself have only spent 24 hrs there 9 yrs ago) and for learning spanish it is definitely a good idea to be off the gringo trail. Don't go to SJDS or Granada for that, and even Leon is now quite full of foreigners (though I suppose "full" is a subjective term). Another option if there are any good spanish schools there is Masaya. It is a nice small city, close to Granada, Managua, beaches, etc.