It's a few years since I was last there so cant recommend any specific hotels as loads have sprung up recently. But in general, from what you have said you'd probably be better off at a hotel on Ao Nang beach, Hat Nopparat Thara - the quieter adjacent beach - or Klong Muang (if you want a 5 star resort in quiet area)

Ao Nang is by far the busiest of the beaches with loads of places to eat & drink and all types of accommodation. Also a good place to base yourself as it's easy to do trips to other islands and do some sightseeing around Krabi province etc. However, the actual beach itself isn't great.

Railay is much nicer but this is a much quieter beach, a couple of fancy resorts but still the main backpacker area. To get from here to Ao Nang you would take a longtail boat, so not as convenient. East Railay is famous for the rock climbing, so if you are into that then it's a good place to go as climbers from all over the world head there to ascend the cliffs

Choose Koh Lanta if you are Swedish

Ditto what mac says.
Krabi, Ao Nang, has the nightlife, with plenty bars and restaurants (no sleaze) and whichever hotel you choose, it's either on the front or just a short stroll to the beach.
Krabi beach is a working beach. Nice at both ends but the centre of it is taken up with longtails and speedboats.
For a bit of R and R it's easy to jump in a longtail and nip round the headland to West Railay or to the nearby islands of Poda, Chicken and Tup. Beautiful coral beaches, crystal seas, ideal for sunbathing and snorkeling.
Lots of tour places to book speedboat trips to Phi Phi, Hong and Kho Lanta.
Would recommend the sea kayaking around Hong and its lagoon and also the mangroves at Ao Luk.

The thing with Krabi is that your best hopping of to the little islands during the day as these are where the best beaches are. Klong Muang where we often go does have five star resorts and prices, but there are also three stars places to be found and a small number of local restaurants - plenty for us as we find Ao Nang way to busy. The beach itself is OK, but as said by others better ones are on the islands, some of which are only a ten minute boat ride away. You can hire a longtail boat - with captain - for the day for a reasonable fee. Take a picnic lunch as many of the islands don't have facilities.

We first went to Ao Nang when it was a quiet little resort with a handful of hotels - returned three years later to find it had mushroomed to a full scale resort. Also you don't really want a hotel in Krabi town itself as its very much a working town (actually quite like it, but its not a holiday resort).

thanks for the replies, do the sailboats just work like water taxis all day then, taking you where you want

Yea, the longtails run all day. There is a kiosk towards the north end of the beach, just where the road turns up to the right, fixed prices per trip and daily hire. You can obtain a ticket there and just like taxis it's a case of rank and file to see which boat leaves next.

We stayed at the Ao Villa Resort, which was great. That was booked through Kuoni on our first trip to Thailand. But I'd recommend booking flights and accomodation seperately.
I'd echo what the others have said. Krabi is fantastic, and Ao Nang is a great base, with a good - if not great - beach, good nightlife, though it is fairly busy. It should be said we're not talking anything like Benidorm here, just quite a modern resort.
We pre-booked 10 nights at the Ao Nang Villa, but once we got there we saw how easy it was to travel around the various beaches and islands and most have some sort of accomodation. I'd have a day or two in Ao Nang, then throw your bags into a longtail and go island hopping, staying in a bungalow.
Enjoy yourself!