Great puzzler! Cap'n Jack's got it, with Flagstaff. The clue for me was the "wigwam indian curio" shop, which were common along Route 66. This picture was taken on "Santa Fe Avenue" on Route 66 through Flagstaff. I found another picture of the same street, from a different perspective, which clearly shows the Commercial Hotel, and to its left the same brick facade of a building, and to its right, the same "Santa Fe" style Wigwam Indian Curio building with the timbers coming out of the facade.
And here's an interesting postcard with nearly the same photo:
The Commercial Hotel burned to the ground in 1975, and is no longer there. At the end of the street in Bill's original photo is the Bank Hotel, which still stands at the corner of Leroux Street and Route 66. The horses and wagon in front are the Grand Canyon "commuter flight" of the day.
Here it is today:
And, finally, there is still a cafe there today still uses a strikingly similar downward-pointing arrow sign as in Bill's mid-40's picture. I wonder if it's a rework of the original? Cool.