I've always heard that Tao Beach is "too small" compare to other pool parties, but after experiencing it for myself, I think I actually prefer it better.
We went on Labor Day weekend Saturday so needless to say it was packed by the time we got there. Luckily we reserved a table and had a great host so getting in was a breeze (even we arrived a little later than suggested time); Our host ended up hooking us up with a great daybed right in the middle of Tao Beach right in front of the DJ booth (Thanks so much again Chris!). We ordered just about every single type of pitchers on the menu as well as beers and straight liquor. Our waitress was very friendly and took care of us even though by 1PM the place was insanely packed.
DJ played a great selection of music, including hip hop, which you don't hear a lot in major clubs in Vegas consider everyone's playing Electro. We had an absolute blast the entire afternoon. If you're with a group (I'd say 4+) reserving daybeds/cabanas/tables is the way to go if you are going on a popular weekend. General admission takes a long time and the bar gets packed really fast, so getting a drink will be a challenge and let's face it, who wants that in Vegas!
Looking forward to LDW2012!