Twenty years after Sleepless in Seattle, Meg Ryan has put the role of America’s sweetheart behind her. This week’s issue of PEOPLE examines why the former queen of romantic comedies has abandoned Hollywood in favor of a peaceful and private life in New York. Ryan today is guarded, cautious, and resolutely determined to avoid the fame that she once described as “traumatizing.” She skips awards shows, rarely does red carpets, and hasn’t granted a major interview in five years. Instead, the 51-year-old actress lives primarily in downtown Manhattan, where she is raising her daughter Daisy, 8, and has been happily dating rocker John Mellencamp, 62, since 2010.

“New York makes you different,” says her friend Delia Ephron, who teamed with Ryan on the audiobook of Ephron’s essay collection, and whose sister, the late writer Nora, was a Ryan pal. “Los Angeles is just about movies. New York is about so much more than that, and so is Meg.” Variously described by those who have worked with her as “shrewd,” “funny,” “self-conscious,” and “aloof,” Ryan often chafed at the gap between her sweetheart persona and her own complicated reality. “It felt…like ideas were being projected onto me that had nothing to do with me,” Ryan, who broke out in 1986’s Top Gun and 1989’s When Harry Met Sally…, has said. “The girl next door to what? I never felt like a very conventional person.”

On the sets of 1993’s Sleepless in Seattle and 1998’s You’ve Got Mail, both directed by Nora Ephron, “she embodied how Nora saw herself,” says Betsy Sokolow-Sherman, a publicist on both films. “Attractive, quirky, wanting to find love and happiness.” But a source who spent time with her through the years offers a sharper-edged view: “She was only America’s sweetheart onscreen,” says the insider. “In her private life, she has always been completely the opposite. She is smart and provocative.”

A friend and former colleague says the divorce from her husband of nine years, Dennis Quaid, 59, and whirlwind romance with Proof of Life costar Russell Crowe, while still married to Quaid, was more difficult than Ryan let on. “All the tabloid attention really shook her up,” says the source. “She was really troubled by it. It contributed to her stepping away.” As she made the choice to downshift her career, opting instead to travel and spend time with her son with Quaid, New York University senior Jack, 21, Ryan found that the variety of roles available to her began to diminish. “Mainly, this is what she was onscreen: lovable,” says the source who spent time with her through the years. “And what you can do with that is limited.” Ryan is “not perceived as aggressively going after parts,” says a veteran talent agent. Another industry source says the actress “was so tired of rom-coms. She was so over it.”

Though Ryan has never commented on the plastic surgery rumors and the merciless online mockery that came with it, multiple sources say such talk may have harmed her career. Also, her withdrawal from Hollywood’s social circuit may have impeded her career. “She keeps her toe in, but the feeling is her focus is elsewhere.” But that, says those who know Ryan, is the way she wants it. These days, life is focused on Daisy, whom she adopted from China in 2006, and Mellencamp, whom she began dating just after his 2010 split from his wife of 18 years, model Elaine Irwin. Quietly pursuing her interests in photography and home design, Ryan is also planning to direct an upcoming film project. And although she is rarely in front of the camera these days, those close to her say she still has the same magic that had audiences falling in love with her nearly 25 years ago. “Meg is enchanting,” says Delia Ephron. “She was always enchanting – and she still is.”

More on Meg Ryan appears in the 10/14/13 issue of PEOPLE; on newsstands now.

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