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Okay now show me more than a single city block
Here are two photos of Plac Szczepański, another public space in Krakow, first in the 1960s(?) followed by the 2020s. It went from being a carpark to being a public square and splash park.
Why?
What do you think this photo series is depicting?
A single block if Google maps is any indicator, it's just not that impressive, but I guess good job closing down one part of a road, sure seems like it hurt the businesses?
Another example is the area around the main train station, which used to be a carpark and bus station. It's now an open public space and shopping center, viewable here. No cars, plenty of places to sit, and plenty of commerce.
That section of Krupnicza at the top of the post is doing fine in terms of business. There's a nice stationery shop, a couple of bakeries, takeaway spots, and even a Starbucks--among others.
If you insist on a larger area full of trade with cars banned, you might consider ulica Grodzka, running from plac Wszystkich Świętych all the way to Wawel Castle. Several city blocks in length and full of shops and restaurants.
If none of that impresses, then maybe give us a concrete rubric, and I'll see what other nice places in Krakow I can suggest.