I absolutely love flax seed. I put it in my Vita-mix shake, sprinkle it on oatmeal and yogurt, mix it into recipes. It contains a fair amount of fiber (not a ton like people think) and is loaded with Omega-3 fatty acids (that your body can't produce on it's own.)
Also, it relieves both constipation AND diarrhea, because it simply makes a person regular. However all people are different, and what works wonders for someone else may not have such a positive effect on you.
And yes, if the flax seed is not ground, it will pass through your body totally unaffected, giving you no benefits whatsoever.