I stayed with my wife in the Hotel Indigo, Xiamen last September and it was fine. Very close to the sea front and also convenient for the airport (via a very long tunnel). With regard to Gulangyu, it is very Chinese and not so easy for Westerners to get to because of restricted ferry access. I also would not want to take heavy baggage onto the island as it is primarily traffic free. Much better to visit Gulangyu as a day trip.