In the middle to late 19th century, there was an architectural fad for "false fronts", where a modest buildings was renovated by adding a larger more impressive facade. Here's an article that discusses the use of false fronts in 19th-century residential and commercial buildings. This short article specifcally says:

The style was popular in the West, after the California Gold Rush of 1849, as a way to make hastily built town buildings look more like the impressive commercial buildings of the East.

Additionally, the tall facades of of the false front gave the merchant a place to put signage that would be easily visible from the other side the street, as in this photo of Dodge City Kansas, taken in the 1874.

It should be noted that 'old west' buildings were not the first nor last buildings to employ facades that obscured the construction of the rest of the building.

When the most cost effective building material was brick, but the use of stonework was in style, a lot of buildings were constructed with a facade utilising stone, covering the rest of the building which was constructed in brick. Quite a few of the local courthouses, post offices and government buildings constructed in the 19th century in my area uses this technique.

Of course the use of facades are just as important today (where the main construction material is concrete but most facades are glass or render). I can't answer your question directly, but I think it is useful to point out that these 'old west' storefront facades did not occur in isolation.