I visited Prague in July 2012, the height of summer, when the sun's rays were intense during the day and the air was cool after sunset. The city was as advertised, a living museum of relics from the middle ages and from the more recent past. It was like Vienna but not as refined, its buildings not as clean, its public transport not quite as efficient. Life appeared to be somewhat on the gritty side, even with ample evidence of prosperity in stores and public places. Strip clubs, massage parlors and dark bars were never far from the main thoroughfares, signs that the veneer of affluence is not too deep and life is perhaps not very comfortable for the average citizen of Prague.
This may explain why we tourists feel like walking targets with Euro or dollar signs pasted on our heads. To be fair, Prague is listening to tourist complaints about petty theft, cheating taxi drivers and money-changer scams. Police abound in the main tourist areas and highly visible warning signs about changing money and taxis have probably improved these practices, while scaring away some customers towards ATMs and mass transit. There are still many opportunities to be fleeced, although mostly on a petty scale. Once you are aware of it, it's almost like a tourist tax. For example, the roast ham stalls (and others) alongside the Old Square advertise a price that sounds like a good deal, until you realize the price is per 100g, and they are already piling it on the plate. When you try to reduce the amount, you are told that the minimum purchase is a weight more than you want, at which point you can walk away to verbal abuse or take the plate - and that's not the end! You can be shorted on the weight (two ways: inaccurate measurement and not getting all that was weighed), and then a convenient increase over the calculated price to include another tip, even if not a rounding. OK, they've got to make a living, I've factored all this into the price, and there's still a lot of work to be done to change Prague's image as a place where tourists have to watch their wallets, not because things are so expensive, but because transparency of transactions is still a novel concept.
If Prague is a living museum, visitors get a hands-on lesson in the history of western civilization, which we are reminded was not that pleasant at times. Brutality was common; conflicts, persecution, wars, famines and epidemics shaped what we see today, in the form of architecture and monuments that were not bombed in the last war and remain in excellent states of preservation. Ironically, these attractions that make Prague a famous tourist destination are what give the city a dour, contemplative personality. You get a better idea of why Franz Kafka wrote what he wrote.