In Palermo Viejo. the square at Plaza Seranno (at the junction of Borges and Honduras) is surrounded by cafes and bars, pretty indistinguishable from one another but almost all with outside seating perfect for watching the world go by.  There are plenty of other of bars, restaurants and cafes in Palermo Viejo/Hollywood with outdoor seating especially along Honduras.  

At the side of Recoleta Cemetery around Avenida Quintana and Alvear there are several cafes overlooking the park, including a micro-brewery and a large central-European style place called La Bila.   All are very pleasant places for people watching.