This hostel is really a gem in the middle of old Oaxaca. The courtyard is very pretty and well kept. All the rooms are through wooden 'saloon' style doors off the courtyard. We stayed in the 'Blanca' Room which was very nice - tastefully decorated and felt more like a hotel than a hostel. The staff are v friendly and helpful and the breakfast is basic but decent.
Only reason it's not getting five stars is because of the shared bathrooms which were very small and you have to trot outside through the courtyard in the night to get to them - but wouldn't stop me from staying again.