Looking to travel, myself, hubby and daughter,26, very active, 10-12 days.
Hubby is able to drive but dont want to spend too much time driving.
Prefer hiking, walking, boating to enjoy and see gorgeous vistas.
Like quaint, unique accommodations in a walkable towns or small village.
Travel from US so several options to arrive in one airport and depart another.

Should we focus on Northen or Southern?
Lovely places in Northern area-Krk, Cres, Losinj OR Southern area: Kornati,Vis, Korcula, Mljet.

It's easy for me to say because I have been to the south three times, once to the north, but even with it to do all over again, I would say north because you do not have to deal with crowds. However, if you think your daughter might be bored with smaller towns, go south.
Also, though we did the north without a car, it is much better to have one. We flew into Zagreb, had a stopover at Opatija, went to Losinj and stayed several days, then en route back to Zagreb, we stayed a night in Lovran. The hiking on Losinj was marvelous, plus there are boat trips. Pula flights typically require several stops, Rijeka flights (which land on neighboring Krk, connected to Rijeka by bridge) seem harder to come by, but check Lufthansa.
In the south, Vis is marvelous, good to pair with Split. Kornati is a big gap in my travels. Korcula and Mljet better paired with Dubrovnik.
Before you do the planning work you did with Greece, check flights--as that will be the major determining factor in any of these itineraries!