I can say that this is The Right place where you can enjoy everything about traditional Korea such as food, cloth, pottery etc.
Lots of Korean restaurants and cafes serve various traditional food, drink and desert.
Insadong is also famous for art galleries. Starbucks café in Insadong is the only one in the world its signboard is named as Korean.

http://english.visitkorea.or.kr/enu/SI/SI_EN_3_6.jsp?cid=259484

I went here last week with 2 Korean teachers from my school. It was very nice. A lot of traditional things. Being rather new to Korea, I found it helpful to have English speaking Koreans with me so I could fully appreciate what I was seeing. We shopped a bit, ate a traditional meal, and had tea at a traditional tea house. I would recommend this part of town to any visitor. I'm taking a friend there, when she visits.

located near/in jongno, a place which i recommend to everyone going to seoul, insadong is a nice little pocket of korean culture. various old style restaurants and bars pepper the area, along with places to buy teas and local crafts. also a very fun toy store! i'm not much into shopping, but if you're looking for souvenirs to take back, definitely get them here.

I liked experiencing a traditional street in Seoul; you get a taste (or sip of tea!) into the older, less modernized Korean lifestyle.

Tucked away in a country that is becoming more and more "Westernized," Insadong is a refreshing change of pace for both tourists, expats, and locals.

I love Insadong due to it's variety of activities and restaurants. Over the weekend, it is even better with performances and flea market. This is a must place for tourist in Seoul. Tourist officers here are very helpful and informative.

This is the place to go to for more of your traditional shopping, and Korean specialized items. I love this place, and my mom visited this section of town three times. They have everything from eating, to household items, to just souveniors and collectables. Eveything sold has great prices. I would reccommend this. If you like amythest, this is the place to go to!

Insadong is the place to go if you want a truly "Korean" experience. Insadong is most widely known for its attention and preservation of the Korean Culture. Its a fun place to be and the teahouses are amazing! Great entertainment if you go at night, too. Lots of great stores to shop in and even to browse. Friendly storeowners who are willing to negotiate.