So which is nicer, Dali or Lijiang? My vote goes to Lijiang. Dali has wider boulevards, beautiful gate pagodas, and the lake. Lijiang is a maze of narrow alleys lines with old and low buildings, many small canals with little bridges all over the place, often lined with ancient dark wooden houses with little plank bridges leading to their doors like in the picture. There are many tourists, but they lose themselves in the many side streets, and the souvenir shops aren't quite so obtrusive.
And Lijiang has Mama Naxi. Mama Naxi operates a guesthouse and restaurant with elan and irresistible good nature. She serves dinner communal style: a dozen delicious dishes on large tables that are shared by everyone. There are many experienced travellers here, some of whom have been on the road for a year, and we share stories and compare notes on all the places we have been. I am sure that between us we have covered the entire planet. A botanist describes how he travelled through Tibet illegally, hiding under blankets at checkpoints, or being hidden from the police by soldiers. We sit and talk until late at night.
There are inspirational signs all over Lijiang. One reads "Civilized behavior of tourists is another bright scenery rational shopping".