Well, I think the magic shop in the Pike Place Market Magic & Novelty Shop (206 624-4271) in Seattle is a very nice place. It has the usual items, as well as some particularly good books. When I was there in June, there were a couple of boxes of used books and pamphlets, very inexpensive, and fun to go through. They also happen to carry a fair number of magic poster reproductions. They have been knowledgeable and courteous.
The reason they have survived is the incredible amount of tourist traffic through there (it is in Pike Place Market after all) - but they still have a nice assortment of items.
The store is on one of the lower levels, not well marked, but with a bunch of other eclectic stores nearby.