For colonization purposes, what is so good about Titan? I have read that Titan is the best candidate for humans to colonize in our Solar System.
However it has no water, it's atmosphere is not breathable and it is -290° F on the surface. It doesn't sound too hospitable to me. Have they forgotten that humans can't live without water?
If this is the best candidate then I think that humans are doomed. So why is Titan the best option for humans to colonize?
There is nowhere in the solar system except for parts of Earth where humans have any hope of surviving without heavy technological support. There is next to no free oxygen anywhere, nowhere has a surface whose temperature remains in a range we can tolerate (generously let's say 230-320K) and nowhere has liquid water on the surface. So, at a minimum, we will need a sealed habitat and some form of protective suit when we travel outside it.
Terraforming -- transforming the environment of some planet to be close enough to Earth's to allow us to live without protection is much discussed, usually for Mars or Venus. Even the most optimistic detailed proposals I have seen suggest it would take centuries or millenia to complete.
Even more speculative is the idea of transforming humans to be able to live on other planets relatively unchanged. Although popular with SF, at the moment I don't think we really have the understanding to say anything specific about this.
So for short-term colonisation, we are left to decide which planet would present the least difficult technological challenges for hi-tech base.  There are a few somewhat serious contenders:

Mars -- relatively close, has hydrogen, carbon and oxygen accessible on the surface (as ice and CO2), atmosphere protects against micro-meteorites and some radiation, surface temperatures not too far from habitable.
Venus (upper atmosphere) -- pressure and temperature are both reasonable; fairly close; limited hydrogen availability; no easy supply of metals; corrosive atmosphere; good micrometeorite and radiation protection; not much to do
Ceres -- very low gravity, no atmosphere, plentiful water ice, easy access to space, easy access to metals etc (from other asteroids), good for supporting space activity
Moon -- very close, no atmosphere, almost no hydrogen, enough of a gravity well to make landing and taking off non-trivial
Titan -- rather remote, plenty of oxygen, hydrogen, carbon and nitrogen, atmosphere protects against radiation, comfortable pressure -- you'd need a heated dry suit or equivalent, lots of interesting stuff in the neighbourhood, cold.
Europa -- plenty of oxygen and hydrogen, lots of radiation on the surface, deep in Jupiter's gravity well and no atmosphere for aerobraking, so not very appealing on the surface, but a &quot;submarine&quot; colony under the ice might be viable, the ice will provide radiation shielding and some warmth and you might be able to swim outside in just a dry suit and breathing gear.

You pays (a lot of) your money and you takes your choice.