There are many hotels in Taos, but only one on the square, and that is La Fonda. We stayed there on a Thursday evening three weeks ago. The first summer concert of the season was held that night. It was fun to watch the crowd and listen to the music from our room facing the square. A thunderstorm caused an early ending to the concert but I think the crowd had a good time.
The service at La Fonda was superb. There was always a person at the front desk for security and the restaurant staff was very attentive to your dining needs. The hotel room itself was pretty small as stated in earlier TA reports but it is an old hotel that has been updated. It was very clean and a fun place to stay. I was able to park outside the front door at a meter for the night rather than paying the $6.00 to park in their lot at the rear of the building. The meter was more economical than the lot and our car was under a street light.
I would recommend a stay at least once in this hotel. It is definitely worth the experience.