Case in point: The Red Caboose and Gotham Model Trains. The stores are located between Rockefeller Center and Penn Station, so easy to stop by while playing tourist.
The Red Caboose is a New York institution, and quite an experience. The store is located in a basement. The shelves and display cabinets are stuffed to the brim with material. Locomotives, cars, landscaping, accessories, track, books, ... At first glance there doesn't appear to be any logic in how items are organized, but after spending a little time it becomes apparent that "like" items are located near each other. E.g. all Maerklin inventory (and there's quite a selection), is within a 5 feet section of shelves, and displays. I use the term "Display" loosely here, since some of the shelves hold models stacked on top of models -- no boxes! Some fell down from a higher level in the display, and stayed where they landed.
Did I mention dusty and cramped? The fascination of this store comes from the fact that this is a collectors dream. Lots of old (sometimes very old) items, very narrow aisles (in some areas I wasn't able to turn around with a backpack on my back), lots of stuff to sift through, ... but boy, this store is dusty and messy. There was dust on boxes, wood shavings on shelves (probably from installing additional shelves), landscaping material stacked on the floor, boxes hanging from hooks in drywall, or wood frames. Obviously, this is not about presenting model trains, but to have a *huge* inventory of vaguely hobby-related stuff.
I did find a model of BR212 (a locomotive I coveted for a while now, since it nicely fits in with the theme of my layout). It's a good looking model, though unfortunately, it was from Maerklin's Hobby series, analog, and had the old style 3 rotor LCF motor. That kind of motor already gave me lots of trouble when digitizing other locomotives. The amount of dust on the box indicated that this locomotive had been in the store for a while. There was no price on the box, so I low-balled an offer (given the amount of trouble I will need to go through to make this run on my layout). The otherwise very nice owner, was almost offended, and after looking up the dealer price in a price list from 2002 (!), suggested that this model wouldn't be right for me. Actually, he was right.
In contrast, Gotham Model Trains is a very nice, small, and clean store on the 13th floor of an office building. There's a small operating layout in the store, display cases, that show the models. Shelves with neatly stacked boxes of cars, organized by manufacturer, car type, system type, and scale. While they didn't keep nearly as much inventory, most of it consisted of recent models at a fair price, where I knew they hadn't been sitting on a shelf somewhere for 10+ years. They don't seem to have a lot of foot business (no wonder, given the lack of advertisements on the side-walk), so the store was mostly empty when I visited. Had I not googled for [model trains] on maps.google.com I would have missed it.
The staff and the owner were super-friendly, and when I left, my backpack was full. I got a set of 6 tank cars, that looks very good behind my BR50, as well as 2 "Schuerzenwagen" passenger cars. No BR212, but I'll keep looking...
Update 2015/12/01:
Looks like The Red Caboose is still around, but Gotham Model Trains is no more.
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