I have stayed in Railay a couple of times, and thoroughly recommend this hotel http://www.bhungathani.com/ Great staff and accommodation. It is on the opposite side of the Railay peninsular from the beaches, but they are a 5-10 minutes walk away. On the plus sides there are lots of great restaurants and bars very close to the hotel (within 5 minutes walk).

I have stayed in Railay in late July before, and we were not affected by the monsoon.