Villages surrounding Pai
Most of the surrounding villages in the Pai valley are quite modern now, but some have pleasant Shan-style wats worth a peek and they can be pleasant spots for a stroll. You'll usually find a village noodle shop too if you need a change from Walking Street tourist food.
Wat Nam Hoo in Nam Hoo village northwest out of town is a picturesque one with an unusual Buddha statue. Wiang Nua has recreated its old brick town gates and though there isn’t much else to see in the village it’s worth a wander.
If you follow the road through Nam Hoo you'll reach the old KMT (Kuomintang) village of Santichong, which was settled in the 1950s by fleeing Republican army units taking refuge over the border after their defeat by Mao Tse Tung's communist forces. A string of these villages loop across northern Thailand; US-backed Thailand was more than happy to accept these staunchly anti-communist and well-trained troops as extra protection for their northern frontier, even if it meant turning a blind eye to their opium activities used to fund themselves.
Even now it still has something of a south Chinese feel to it, with low Yunnanese-style houses scattered across a steep hillside, but it's a lot tamer than it was even only 20 years ago, when opium was still the mainstay of the village and old Chinese soldiers wandered the streets in their old Republican uniforms, automatic rifles in hand. Today it's quite popular with Thai tourists, with a large tasting area for tea, which has replaced opium as an important crop, and a souvenir market at the village entrance. It's something of a mini Mae Salong and if you follow the road through the village you’ll reach the Yun Lai viewpoint, which looks back over the entire Pai valley.
Just past Santichong and with its eponymous waterfall is a Lisu village, Mor Peang. While many of the village women still wear traditional dress, the houses are much more Thai than Lisu -- continue past the village to reach the Mor Peang waterfall. For more traditional villages you're going to have to either head for Pang Mapha or walk a long way into the hills.