Yes, this is a much talked about subject, I think. Legally, as derekb said, biking on the sidewalk is not legal in the CDB, but outside of that it’s OK.
As for etiquette: I feel like that’s a quaint concept at this point. It sounds like you’re considerate when you bike on sidewalks – my feeling is that there’s room for both cyclists and pedestrians on the sidewalks but generally cyclists should move carefully (and yield) when around pedestrians. But ultimately, many folks in this town just do what they want and come up with their own justifications – that goes for cyclists, pedestrians, and drivers no matter where they are.