Nour Halal Meats -- Reasonable Merguez source
I'm always on the lookout for a reasonable source for Merguez sausage. Fatted Calf's is good, but it's $9 per pound and they "cheat" by adding a little pork to the mix. Wandering through the Tenderloin on Sunday, I spotted Nour Halal Meats at 476 Eddy. Yes, they had Merguez but only a beef version was on hand. The friendly butcher told me they have freshly-made lamb merguez on Tuesday, so I returned today. They also make a chicken version which, along with the beef, is freshly made on Wednesday. The lamb merguez was perhaps a little lighter on the harissa than I like but otherwise was the right texture and nicely spiced. In both respects it was better than the beef version, though it may have been because the lamb was fresh, while the beef was four or five days old when I tried it. All versions are $3.99/lb, less than half the price of Fatted Calf's.
Nour Halal Meats and Market
476 Eddy, nr. Hyde
If lovely lamb is part of what you're seeking - I know you mentioned the sausages but anyhow, the lamb at Queen of Sheeba at the corner of Sutter and Larkin is great. The lamb comes in whole and they can cut it to your specifications. The lamb is very young - the rib bones are smaller in diameter than kid's chopsticks. They also have some frozen lamb, as well as fresh cuts. The lots of spices and fascinating middle eastern food goodies. I like the smoked green wheat-freekah and the tea with cardamom and I have plans... She also sells sambusas - like samosas. Great place, reasonable prices.
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I agree that chicken Merguez may be a Californication, but I've been told Merguez with beef or a beef-lamb mixture is pretty common throughout the Maghreb and beyond. I think the best Merguez I've had (in Montreal) was made by Lebanese. And if you want to be a stickler, the "lamb" is probably goat or mutton.
Unfortunately, Astoria is a rather long walk from San Francisco.