I much favor a loop system. That would make it a lot easier to add more cars onto the track at peak times and have more service during then. With a hub and spoke, there would only be one car on a track. The loop system would also encourage downtown to develop much more organically.
The hub and spoke system does have one advantage though, and that's that a collision with a car would have less impact on a spoke than if it were on a loop that the entire system is along.
Brick streets are no big deal.
Here's an example of what's happened in Houston with LIGHT RAIL. LRT typically moves a lot faster than streetcar and is less accessible to pedestrians, therefor it usually has its own right of way..but not in Houston. Streetcar typically poses next do NO risk to cars or pedestrians because it's slower and more accessible to pedestrians, stops more often, etc.
YouTube - Metro's Greatest Hits
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edit: looks like Kerry already beat me to some of the answers..
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