Lives happily in the middle of Pudsey (6)
I believe the answer is:
dwells
'lives' is the definition.
(to dwell somewhere is to live there)
'happily in the middle of pudsey' is the wordplay.
'happily' becomes 'well' (I can't justify this - if you can you should give a lot more credence to this answer).
'in the' indicates putting letters inside.
'middle of' indicates the central letters.
The centre of 'pudsey' is 'ds'.
'well' going inside 'ds' is 'DWELLS'.
Can you help me to learn more?
(Other definitions for dwells that I've seen before include "pauses" , "Establishes oneself" , "Lives in, inhabits" , "Lodges or resides" .)