we’ve been to phuket in all the seasons now, christmas, easter (their new year), and august too. we took a chance in august because as you say, its their rainy season, but it fell perfect for us. it chucked it down in the weeks before, stayed sunny for the 3 weeks we were there, then chucked it down for weeks afterwards, so we count ourselves lucky. the holiday would definately have been spoilt a bit if the weather hadnt been kind to us but we were tied to ours and kids hols too, but it couldnt have fell better for us.
im assuming that the rest of thailand would be the same too during august, so its really a case of ‘do you feel lucky?’ 🙂
i know the island quite well by now, so if you got any specific questions about it, fire away. email address in profile.
EDIT: yes, theres some touristy, ex-pat areas (mainly south), but theres also a fair few quieter beaches up nearer the airport on the west coast.
cheers