I was going to write a post about Pamela Dean's work in general, but I am running late, so I will instead call your attention to her work at shorter length, which is not often discussed but is very good.
Dean is a subtle writer, and all of these stories will reward, and sometimes require re-reading. She uses a great deal of literary allusions, and when, as is the case in the Liavek stories, she cannot draw from our canon, she will make up her own. Her characters feel a great deal, but generally beneath a bright intellectual surface. Her children and animals are very real and sometimes feral; her magic is mysterious and strange.
"Owlswater," which appears in Xanadu, is related to the Hidden Country books but can be read separately. A young magician goes on a quest to achieve wisdom, and is sidetracked by a ballad into the arms of a beautiful young woman. He does achieve wisdom, and something else as well, and all at great and unsuspected cost. It's not horror, but it's very creepy, and as atmospheric as the ballads that echo through it.
"This Fair Gift," from Sisters in Fantasy II, is a very odd story in a very odd setting, a world much like ours except that magicians file patents on magical clothing, and secretaries use computer cards to do very accurate tarot readings via Shakespeare sonnets. In a law firm with Arthurian echoes, a set of magical clothing that reveals the essential traits of the wearer is given out as party favors, thereby revealing the office workers' inner selves and their relationships with each other. Ack, this is a really hard story to describe. The characters are vivid, the background is fascinating, and you will really want to wear the clothes. I have read this repeatedly, and matched most of the characters with their Arthurian counterparts, but I still don't know who Emily Goldberg is, the lawyer who gets the Blouse of Daring and Integrity.
Some of her best work appears in the five-volume Liavek series, which is the only shared world series in existence that was good to start with and never turned into a huge mess. (Wild Cards and the infamous volume in which Dr. Tachyon is body-switched with a teenage girl, raped and impregnated by his psychotic grandson, and gives birth while orbiting his home planet, I am looking at you.) The series, which is set in a Middle-Eastern-ish city with a unique magic system based on birthdays, also features stand-out work by John M. Ford, Emma Bull, Will Shetterly, Steven Brust, Megan Lindholm (aka Robin Hobb), Patricia Wrede, and Alan Moore, and is well worth seeking out. Though many of the stories stand alone, the series should be read in order to fully appreciate the ones by Dean and Brust, both of which would form short novels if collected.
Dean's Liavek stories concern the youngest members of a horrendously dysfunctional family that is forced to emigrate to Liavek due to political pressures in their homeland. The first set of stories focuses on Nerissa, who is made so miserable by her family that she contemplates suicide; she meets a priest from the Way of Responsible Life, whose members are sworn suicides. The catch is that they may not die until they have first attended to all their responsibilities in life. In practice, this catch transforms the sect into a rather Zen-like system that's more about losing attachments than it is about death... although it is also about death. Nerissa's attempt to transfer her sole responsibility-- her cat-- and her involvement with the church ends up entangling her more thoroughly in life than she had ever been entangled before. Later stories concern Nerissa's sister; her run-away brother, who has joined a theatre troupe and is working out his feelings about his family by writing plays about them and engaging in complicated love affairs; and finally with Nerissa again, and the priest she met in the very first story, and what the Way of Responsible Life is really about.
I see that I have written a sort of plot summary which doesn't really convey the delicate flavor of the stories. They are subtle and complex, with much unsaid that needs to be intuited, and the cumulative emotional impact is powerful.