We have just come back from a week in Paleokastrisa, and had a lovely time. The weather in this last week of September was wonderful, with temperatures of around 28 degrees, and we only had one day of rain (the last day thankfully). The bays are lovely, with shingle/pebbles and a gorgeous blue/green calm sea. Great for snorkelling! The fish come in very close! There were a few problems with mozzies, so make sure you get some good repellent.
At this time of year it was quiet, but the beaches can get crowded due to the large numbers of day-trippers that come to the resort on coaches from other resorts. I wouldn't come here in peak season, it would just be too busy.
There are a number of good resaurants, the best in our view were LIMANI (by the harbour)..great fish meals as well as traditional Greek fare. The other was ADAMI (near the top end of the resort)...again, good food and a lovely view over the harbour. ONE TO MISS.....please don't waste your time or money on eating at APOLLON (overlooking the main bay, next to the bakery). The staff are mostly Brits, the food was awful and micro-waved to death, and worst of of all, they were quite mean to a little stray kitten that was hovering around for tit-bits near the tables. We were actually told not to be nice to the cat in a quite rude way, before the waitress scooped up the offending kitty and moved it over a busy road!.
We went with KOSMAR, and although our rep was nice, we were let down by the travel companies they use for the excursions. On the trip to Corfu Town the driver was 30 minutes late, then turned a 40 minute drive into an hour and half whilst they picked up other people from resorts at the other end of the island! And we booked a trip to Albania, and that didn't even take place because the driver didn't bother to turn up! This is quite common apparently, although no-one told us that when we booked. Still, we got our money back. What annoyed us the most was the 24 hour delay on the flight back! Kosmar used Excell Airlines and they were awful. No communication with the passengers, and we were just dumped at a local (although 4 star) hotel whilst they tried to sort out another flight. A lot of people were left without clothes and it must have left a few people out of pocket.
Overall, this is a lovely resort out of season. We went to Sidari, Ipsos and San Stefanos, and Paleo was deffiniately the nicest resort we saw, with the least amount of Brits/noisey kids and football fans!