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This theater operated in the 50's and 60's steadily. By the 1970's, it was also doubling as a Lutheran church. One of the mentions of church services gives the location as being on Main St. The classified ad listing gives the dimensions as 42x100 feet. Looking at the old articles, there is a mention of a homecoming dance that centered around the theater in 1971. The kids would snake-dance around the "village" and back to the theater.
OK, so where would the "village" be? I think right about where Pollard's Service is now based on historical aerial photography. That was where most of the structures were concentrated, roughly speaking. The former operator of the theater was the Pollard family. There is a Quonset hut looking structure behind Pollard's Service. Could this have been the old auditorium? It wouldn't be the first time a structure like this was used for that purpose. There are 2-3 examples around Michigan, the Ken in Frankenmuth being one that comes to mind. It's a bit of a long shot, but a possibility nonetheless.