The cave house in Oia really is in the best possible position! It has a great view of the coast and to have that balcony overlooking it all is very special. Yes there are a lot of people taking photos but you get used to it and just be friendly and let them on the balcony every now and then and you'll make plenty of friends :) it is in walking distance to plenty of shops and restaurants, also Oia Square where the main bus picks you up is a 5 minute stroll.
The house itself is also very good, you could easily have 6 or 7 people stay (we had 4) and be quite comfortable. The kitchen is small but with so many good restaurants you barely need it! Yiannis met us at Oia Square, albeit 45 minutes late, and carried our suitcases up and down the steps which was very nice. He also offered his services and knowledge 24/7 which was also helpful!
All in all an incredibly perfect spot, definitely stay here if you are considering it!