If you want a real world analogue, think the East African coast - Zanzibar, the route between the Red Sea and Zimbabwe, or the sea route to India.
Another, totally different Arabian Nights setting could be in Carmania and the western Lunar Heartlands, which have a certain Persian touch, and have inherited some "Arabic" notions (like "sultans"). If you aim for a Harun-al-Rashid-like Baghdad, Oronin Sultanate might offer suitable cities.
Joerg Baumgartner (via Hotmail)
mailto:joe_at_toppoint.de
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