No question about it - the new type of SERP for queries that contain a location or geographic name have significantly changed the traffic picture from Google search results. The fall off in clicks as your listing gets pushed down the page can be major.
I'm happy to hear that you're seeing an increase from image search - not everyone with this problem is so lucky. Most people I know in this situation have had to take a hard look at their business model as it relates to search traffic. Where revenue is on the line, this is an adapt-or-die situation, and each business needs to find it's own solution.