Heyo, hitchhiked down to Morocco over the summer and finished my trip in Marrakech, so I'll do my best
It is an amazing city, but definitely not one for a relaxing break! Memories of having a snake wrapped around my neck to drag me over to someone's stall and suchlike..
As for clothes...I wore some 3/4 length cut-offs and a t-shirt for basically my entire time there, attitudes vary massively around the country, but in a place as touristed as Marrakech, they're a little more used to seeing skin. You probably won't get in to trouble for exposing something you shouldn't, but you might find people just a little less welcoming. As for women, the girl I travelled with generally made sure to cover her shoulders and knees, and not expose her waist, seemed to go down fine.
I assume you've already got accommodation booked, do you know where in the city it is? As in most Moroccan cities, there's an old town (medina) and a ville nouvelle, the latter being where most of the banks/chain stores/plush hotels are located. This was a bit out of our budget, but it's easy enough to get between them - there's one long boulevard connecting the two, a cheap taxi ride if you don't fancy the walk. All of the historical bits are, logically, in the old town, though it's quite easy to walk around most of them.
The main market is called the Djemaa el Fna, and it's quite amazing - vast and busy all the time. The best time to visit it from a sightseeing perspective would be around sunset, as that's when all the performers and storytellers come out, snake charmers, musicians and so on. Don't expect to get too much shopping done then though, as it's ridiculously busy - that said, it's not that great a place to visit in the midday sun, so you may have to go with it. There's a number of cafes with balconies around the square, though these will charge a premium, alternatively you can sit down for a cheap evening meal and watch the entertainment all round, from one of the many food stalls. Oh, and try the orange juice
Try to make sure they're not watering it down, but it's lovely for about 3Dh a glass, very refreshing. Beyond the square is a massive network of streets forming a covered market, where you can pick up just about anything you'd want - most things are more expensive in Marrakech than elsewhere in the country, but still not bad for what you're getting.
Expect to haggle over pretty much anything you buy at the market (food aside), and decide what you're willing to pay before getting involved. We ended up getting some things for around 10% of what the sellers were originally asking, while others wouldn't start quite so high. Basically, you're trying to find a price that's acceptable for you and them, not force them in to making a loss
That said, I'm rubbish at it, the girl I travelled with did it all, I just sat around in the shops drinking mint tea.
Ah yes, mint tea - one of my favourite things about the country, served everywhere, and it's polite to accept it if offered. If you find out you like it, it's available all over the place for 1 or 2 Dh a glass. Look for little places with lots of tables, predominantly occupied by men.
One thing to look out for in the market - pickpockets, touts, scammers and the like. There are various popular ones, such as being given a "gift" or henna tattoo, then being chased down by a group of people and forced to pay over the odds for it. Also beware that if asking someone in the streets for directions, they may lead you and expect to be paid for their services, so you may be best off asking in a shop. Depending on where you stay, you may also be met/led around by someone working for the place, who are generally reliable and their services often covered by your hotel bill - that said, that wont apply to some of the cheaper hostel style accommodation. We stayed our last night in a riad in the backstreets behind the Djemaa el Fna, and we'd never have found the place were it not for the guide - though it was worth the mission.
Applies to taxis too - make sure they're going to use the meter, and not just pull a number out of the air. Most were fairly good in Marrakech, though Casablanca was a nightmare for it. You'll be wanting petit taxis - they're all the same colour, and will take you anywhere within the city for a metered fee. Grand taxis are mostly old Mercedes, are used more for intercity travel, though it's possible to use locally if you're willing to pay for all the spaces, and the driver agrees.
As for sights, there's hundreds...we did the 24 hour sightseeing bus thing, which I wouldn't normally go for, but it goes pretty much everywhere you'd want to see in the city, so turned out to be a fairly cost effective way of getting about. We also dived in to the backstreets of the market to get to the Ben Youssef Medrassa and the museum next to it, both of which were quite stunning. Good luck finding them though
Maps begin to lose meaning after an hour of wandering through street after street of very similar looking shops.
Also worth taking a look at the Jardin Majorelle, beautifully tranquil place to escape the bustle of the city, with obscure plants and some nice water elements. You'll also not be able to avoid the Koutoubia Mosque with its minaret, visible pretty much anywhere in the city.
Evening wise, there are a fair few clubs if that's your thing, though it can be tricky to find out which are open, as various times they seemed to be closed for no apparent reason. There's an english language magazine for the city, aimed at residents, which sometimes seems to have events listed in it. You can get a copy at the English language bookstore somewhere along Avenue Mohammed V, though the name escapes me...it's definitely in the lonely planet guide, if anyone has a copy of that - my friend has ours. There's a couple of bars in the Medina, we ended up at the Kozi bar quite often, with nice views from the rooftops and 2 other levels. Very friendly staff, and the food, though expensive, was superb (I believe it specilies in sushi). Wherever you go, expect to pay more for imported beers/spirits, though the local Moroccan beers are ok, as is some of the wine.
Phew! Well, have a great time, ask if you've got any questions, happy to help
