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Koh Phi Phi - Area Info?

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Could someone please describe to me the different areas on Koh Phi Phi? Like which part is the main town area and what can I expect if I stay in a hotel there? And what about the hotels that are further out like Holiday Inn and Outrigger? If I'm out there, will it be too far to get into town without a taxi or something? Is there plenty to do and see out there? Or are you stuck with resort restaurants only? Are the beaches better in one area over another? How many days is a good length to stay on Phi Phi? Are there any beach front home rentals? Or just hotels? Do the beaches offer water sports? Anything else I might want to know?

We will be a group of 6-8, fun loving adventurous 45-50 year olds, staying in Phuket for few days, and possibly touring around on a catamaran for 3-4 days, before arriving on Phi Phi...

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