My picks for best Italian in Albany:
1. D'Raymonds. It's just off Albany-Shaker Road near Osborne Road. This is one of our absolute favorites in Albany. Surprising we don't get there more often. Great reputation for veal (though I'm not much of a veal eater). All the dishes are great.
They start you off with a little fried dough treat. If you order the salad, you get a lot of salad for not much money. Haven't been there in a while, but I just love everything they have.
It's got a nice atmosphere - feels homey. Not a good place for kids though. Also it looks crowded when you're walking in, but you don't notice that feeling when you're sitting down.
2. Lombardo's. On Madison near Pearl. Also outstanding. Again, surprising we don't get there more. Last time I think I picked my wife up for lunch and we got over there. Great food.
Also has a special atmosphere. Feels like you walked into the 1930s. Not that I would know since I was born in the 60s, but still. Has a bit of a celebrity thing too. Seems like I often see a local celebrity when I go there. I've seen TV news people. Once we saw the retired DA with the retired political cartoonist - even had a nice chat with them.
3. Carmine's. On Central Avenue, between Everett and Colvin, in the back of a minimall. Excellent food. Carmine is a local celebrity. His menu is more edgy. It's not classic Italian food, but maybe a bit nouvelle. Last time we were there seemed like a lot of dishes had sundried tomatoes in them.
That's the cream of the crop. I should put in honorable mentions for Provence and Milano. I haven't been to them as much, but they're good.
For some reason my wife likes Olive Garden, and we go there all the time. I'm kinda sick of it, but it is better for kids - if you can get a table.
Note from 7/30/06: I forgot to mention the Italian Community Center. Also one of my favorites, and I'm going there all the time now since it's now next door to our new office. It used to be called Le Caravelle, but they've dropped that name. It's run by Mallozzi's now. Food was good before and continues to be good now.