Water On Mars? Yes

Mars has less gravitational pull than the Earth does. When water evaporates on Earth, it stays in the atmosphere. When water evaporates on Mars, it often escapes the planet altogether, either by being stripped by solar winds, or it is just not capable of being "held onto" by Mars' weaker gravity. So, water stays in the places where it is more likely to stay frozen. And, having less atmospheric pressure on Mars than on Earth, the melting point of water on Mars is going to be a cooler temp. Mars, like Earth, receives less direct insolation at the poles than near the Equator, so it stays cooler there. Less melting, less evaporation, less departure and loss of water.
It has been long since ice has been found there. Scientists think there may be life forms deep under the frozen water bodies there. So there is no doubt lots of water is there in mars. There is definitely water ice and water vapor on Mars. The presence of both forms of water was detected decades ago using spectrometers.
As far as liquid water is concerned, the presence of water in that form on Mars is as yet unknown. On the surface, liquid water would boil almost immediately into water vapour because of the low atmospheric pressure.
However, some scientists theorize that liquid water could exist in underground reservoirs. This is why everyone gets excited when a Mars orbiter snaps a photo of something looking like a gulley left recently by water. To make such a gully, liquid water would have to erupt somehow from underground, and in enough quantity to be able to flow some distance before it boiled away. Thus, the gulley's being photographed are actually dry, but may have been formed by water before it boiled.
What they'd like to do is catch such an eruption in the act, but the chances of that happening are slim. More likely, they'll verify the presence of underground liquid water using radar on the present orbiter. It's important to note that those photographs of gulleys DO NOT prove the existence of water. They merely suggest it because that is one way the gulleys MIGHT have formed.
Other ways:
1. Lava flow
2. Dust devils. Dust devils that leave trails have been photographed in action by the rovers.
Those two possibilities supposedly create gulleys or channels not characteristic of those created by water.

water on mars: By NASA (Public domain), via Wikimedia Commons

However, I'll believe it when they either photograph liquid water flowing or detect underground water using radar. Seriously, I believe the first people will start walking on Mars probably by 2020. As for terraforming and the rest, that is still relatively science-fiction. I was watching one video on MSN that stated that it could be possible by bombing the planet with nuclear weapons and then placing Sulphur and other chemical components. After all that is done, then they would place robotic crawlers to slowly make the surface usable for Humans. We also got the depletion of oil crisis which will reduce the willingness of Nasa and other entities to contribute that little special liquid left for Space when it can be used on Planet Earth. We haven't even exploited space hotels so to assume that we will skip levels and go to Mars is something a bit too optimistic. I think many of us will see it in our lifetime (20 - 30 somethings). Probably some time between 2025 - 2050, hard to pin point when exactly. Mars is an interesting planet - but unless we figure out a way to create and maintain a much thicker atmosphere filled with oxygen & nitrogen (Mars has an atmosphere thousands of times thinner than Earth's and it's made up almost entirely of Carbon Dioxide), I don't see us colonizing it. Though, with the way technology is progressing today - I wouldn't say it's impossible that that capability will forever exceed our grasp.
Couple of things. First, Mars is not the only place beside Earth in this solar system with water. In fact, there is even liquid water in this solar system- that really upstages Mars! If you want to check that out further, look up Callisto and Europa, both moons of Jupiter. So I would say life has a better chance of being found there if anywhere.

What ancient mars may have looked like billions of years ago. It's based on MOLA data. The elevations have been updated so the shore lines will closely approximate their ancient locations. Also any mountains less than two billion years old have been removed.

By Ittiz (Own work) (CC-BY-SA-3.0), via Wikimedia Commons
You're right though, if we found two planets in our solar system with life- or life anywhere else really- that pretty much guarentees that life is prevalent throughout the universe, though it may not be intelligent life. If we find anything in our solar system at least, it will almost surely be some kind of primitive micro-organism. At any rate, that would be a huge step.
As far as colonizing Mars, I think we have a long time to go. The distance and time that it takes to get there is considerable at this point for our technology, and no one is ready to give up the huge sums of money necessary to put humans on Mars. Putting people on there on a permanenent/semi-permanent basis would require a huge amount of material, time, and money, as well as technological advances. Then once there, we encounter several problems, such as: the lack of Martial atmosphere which not only means no air to breathe but also no protection from solar radiation, the extreme weather, the reduction in gravity, the lack of physical resources (so we'd constantly have to be resupplied by Earth- very expenisve and time consuming), just to name a few things. Unfortunately this is just not in the cards for the forseeable future, although technological advances can be unpredictable- sometimes they happen more rapidly than anyone ould imagine (like computers), and sometimes they are predicted to happen 'in just a few years' but never happen at all (like flying cars).
As far as what the one guy said about geothermal vents providing heat to melt ice and form an atmosphere, I think that's wishful thinking. Mars is geologically dead, and has been for a very long time. What heat is remaining is probably minimal, and we wouldn't want an atmosphere of pure water anyway- water, as many know, is a greenhouse gas much more powerful than CO2, and a runaway greenhouse effect is a real problem (see: Venus). In addition, the other problem is that Mars is too small to hold on to a substantial atmosphere with its Gravity, and solar winds will always be a problem because without an active core to create a magnetosphere, you're kind of screwed anyway.
Bottom line- as far as life goes, there are better options in the solar system than Mars probably. As far a permanent settlement, I would say that the moon would probably be colonized before Mars. As far as when humans will simply set foot on Mars, that I believe is a rather long time away as well, barring significant technological advances and funding. In short, don't hold your breath. Sorry to be depressing.