I went to Xiahe, a small town situated in a valley of Gansu Province this summer of 2005. It is prominent for the Labrang Monastery that all the Tibetans go around early as 3 AM in the mornings to late afternoon. At any time of the day, you will see a continuous flood of people turning the prayer wheels and reciting OM MANAY PAYMAY HOM (Tibetan prayer) at the same time.
The best place to stay in Xiahe is the Tara Guest House, which is located right across the street from the monastery. Its balcony provides a splendid view of the town-including the main street with all the motor wagons and taxis that bring tourists from the bus station to the main spot in town, the stores that line up on both sides of the street, the road that leads to the river and the beautiful, green towering mountains, and a magnificient view of the monastery. It is a view that you cannot get anywhere else in town as Tara Guest House is situated in the perfect spot for conveniency and pleasure of seeking to find beautiful scenery. It is a cozy place to be as it run by a well-established family--the proprietor being fluent in English. The building is built in a style that make its guests feel at home -- there is no private bath but there are bathrooms on each floor. The rooms are very clean and have very decent prices. Double rooms range from $7-8 (60-70 yuan) and dorm beds range from $3-5. There's hot shower in the mornings and in the evenings. Bike rental and laundry are also available--the service is great.
There are spacious common rooms on each floor provided with books and magazines from the States. Personally, Tara Guest House is a great place to stay at as it is placed in the best location in town.