Go to the Rachada Cafe website, then click on gay venues and you will find a substantial list of m4m massage parlors, similar to the dedicated m4m venues in Bangkok, Pattaya, Phuket and more. They are not 'in denial', not at all.
http://www.radchada.com/GayChiangmai.html
or,
http://www.radchada.com -then click on 'male massage' on the list on the left side of the opening page.
Most of the websites have photos of the massage staff, usually without shirt but not more than that.
Most of these venues have individual rooms with door & lock rather than curtained areas.
'Happiness' is very much part of the 'arrangement / expectation', and well understod by the massage man, if that's what the client wants. Full 'action' is a possibility with some boys, but of course the type / extent of 'action and happiness' is also up what the massage man will agree to.
Some clients will indicate to the captain / manager what 'level / type of happiness' they are looking for. Some captains / managers will then recommend various staff members, but on the other hand some will say that they don't recommend and it's up to you to make an 'arrangement' with the massage man once inside the massage room.
Pretty much expect the massage man to instigate some level of action at some stage of the proceedings, he wants to try to increase the possible tip.