No tilling - ever, NEVER. Tilling is the fast track to a bumpy surface like you have. If you have an intolerably bumpy surface, start with the existing surface and either grind off the peaks and fill the valleys or just fill the valleys up to the peaks. The easiest material to use is sand because it does not become clods in the middle of the project. Clods are the bane of leveling. You cannot make the surface any leveler than the highest clods. With sand it moves easy to fill and never requires additional sand just to get up to the highest clod.

If you are unwilling to water once per week, then there is not much you can do to improve. You could add more clover seed and let Nature take her course. Clover is the type of plant that will survive in poor soil. Your soil is poor because you have neglected to water it regularly. The microbes that normally live in the soil require water and food if you want a healthy soil. Water is water but the food they need comes best in the form of ground up grains like ordinary corn meal, corn gluten meal, soybean meal, alfalfa pellets or meal, cottonseed meal, or a commercial fertilizer called Milorganite. The products provide food in the form of protein, carbohydrates, minerals, vitamins, and enzymes to the microbes. The well fed microbes, in turn, provide plant food to the grass. Sounds odd but this was Mother Nature's design over the past 4 billion years. We just discovered it in the 1990s. We always knew there were a few "germs" in the soil, but we really did not know there were tens of thousands of beneficial microbes in the soil. The advent of dirt cheap DNA testing allowed scientists literally to test dirt for signs of life. The first thing they need is water if you want to improve your yard.

The best way to water is deeply like when it rains all day. So water all at once when you water. Spreading out your water over the entire week is what encourages the growth of weeds. Sometimes you can't help when it rains but other times you can restrain yourself from frequent watering. Figure 1 inch, once per week during the hottest heat of summer. In your area you may never get temps above 90 and can go 2 weeks between deep watering. You'll have to judge. So avoid daily watering and move toward deep watering with days in between.

You are mowing right...maybe. Mulch mowing is good. You may; however, be mowing too low. For northern grasses start at the highest setting and see if you want to come down a notch or two. But let all the grass get all the way up so the mower is mowing it and then decide. Tall grass develops much deeper roots which require less and less water with the height. Short grass needs a LOT of water. Just to prove that point I have an entire lawn which has not been mowed since Oct 2011. Parts of the lawn are 32 inches tall. Those parts have not been watered since Oct 2011 and look excellent. Now it has rained but I live on the edge of the Texas desert, so we don't get rain very often or very deep. Point is keep your grass as high as you can stand it. It takes less water and keeps more weeds out.

If you decide to use a herbicide, use a liquid that you can spot spray individual weeds. A hose end type sprayer will work fine if you have a way to turn it of at the sprayer.

Your lawn was likely a mix of fescue and Kentucky bluegrass. Fescue grass grows in clumps so if you want a dense turf, you need lots of seed. KBG spreads and fills in like a carpet so it does not need as much seed. Fescue tolerates some shade. KBG does not tolerate shade. Fescue seed sprouts in 2 weeks. KBG sprouts in 3 weeks. If you decide to seed with a mix of fescue and KBG, be sure to keep up the daily watering for at least 3 weeks to be sure you have some KBG germination.

If you decide to reseed, wait until the end of summer to do that. August might be a good time depending on when the heat breaks. You can either wipe out the entire yard with RoundUp or just scalp it down and seed. Watering for new seed requires 3x per day for a very short time. All you need to do is keep the seed moist so it will sprout. If you miss doing it this fall, then wait until next fall. Spring seeding guarantees you a yard full of crabgrass. If you get it right in the fall, then it should be fairly filled in by winter and will come back nice in the spring.

If you want to fertilize now, organic fertilizer is what I suggest. It will not burn. Just go to the feed store and find a 50-pound bag of anything I mentioned in the earlier paragraph. I like alfalfa pellets (rabbit chow) for the low low cost of $12.50 per bag. Apply at a rate of 20 pounds per 1,000 square feet. All of them go down at that rate. If you over apply, no worries. You can double that rate and double it again with no worries. These organic feeds work surprisingly well when you are watering properly.

Wow - A lot of great information! thank you.

It sounds like I need to get used to the idea of watering the lawn... I've been resisting because I have 3/4 acre and no in ground sprinkler system, so I guess I need to buy some longer hoses and nicer sprinklers.

I do mow my lawn as high as possible to keep it healthy and strong, so we've got that covered.

My lawn is part sun, and a lot of shade. We are getting tons of rain this spring, so the lawn is filling up, however it is filling up with weeds.

Follow up questions: If I fertilize now, won't I be encouraging the weeds too?
Fertilizer: I have an extra 20 pound bag of Chickity doo doo (5-3-2.5, chicken manure) would that be a decent gentle fertilizer, or should I pick up some Corn Gluten meal or alfalfa pellets instead?
If I understand correctly, you suggest I fertilize now, kill off the weeds in August, and hold off on all seeding until late August?

Thanks again for your wonderful advice!

Eric