Some friends and I recently stayed at Riad Flam and it is a beautiful and tranquil place. It is on the edge of the main area but still very close to the center square and it was great to stay away from the craziness and retreat back here. Upon arrival we were greeted and given some lovely mint tea and Moroccan biscuits while doing our paperwork. The Rooms were lovely as is the entire riad with a very nice outdoor area that we enjoyed sitting in for the afternoon reading our books and drinking mojitos after we had had treatments at the onsite spa facilities.
The food is lovely and the breakfasts were divine. We had dinner at the rooftop terrace one night and it was a beautiful lamb, prune and almond Tagine that was to die for.
The only difficult thing about Riad Flam is that the owner only speaks french so while trying to check out we were unable to communicate so had to wait for the other gentleman who spoke English to come back so that we could do all the paperwork but we had also had problems communicating with her at other times.
Other than that I would highly recommend Riad Flam as a great place to stay.