I've been to Oahu several times for work and vacation, but never have lived there. One of my buddies is from Oahu and we stay at his parents when we go, but it's been about 5 years. I'm in the military, so I am allowed on base and that makes groceries a lot cheaper (shopping at the commissary). It's expensive, but as you said, it's paradise. The beaches are incredible and quite secluded in certain areas (outside of the tourist spots).
I'd jump at the opportunity to live/work there....but I'd probably want it to be short lived, maybe 2-4 years.