We found Psalidi to be quiet with great places to eat. If we fancied a bit of night life it was a 5 minute (if that) bus ride up the road to Kos Town where there was a lot of choices of restaurants and bars. In the day it was a great place to wander around and see the ancient sites or do a bit of shopping, that is if you could tear yourself away from lounging by the pool on a sun bed.
Useful Tips:
Lovely places to eat on the beach. Great local food and the fire water! Fun family days out to the water park. Romantic evenings watching the sunset from a bar up in the mountains at Zia. Genuinely fantastic local folk.