NOTE: I am in Shiraz now. I may not be able to make any more updates until I get home because of internet issues (slowness, tiny upload/download limit per day, proxy issues).
I got a late afternoon train from Esfahan to Yazd last Wednesday the 16th. It took a little over four hours, and I got to Yazd about 8:45PM. Soon after leaving Esfahan we were out in the desert and it was mostly desert the whole way. Yazd is a desert city with a lot of adobe (or whatever they call it in Farsi) buildings. The traditional houses have towers on top of them that, when the wind blows, pull the warm air up and out of the house - a sort of air conditioning.
There were three other guys in my compartment on the train, all Iranian - a computer science graduate student, a lawyer, and a doctor. Two of them spoke English very well and were all very friendly. The lawyer invited me to stay at his house the next time I am in Esfahan.
The hotel where I wanted to stay, the Silk Road Hotel, was full (this is becoming a pattern). So they sent me across the road to another hotel that is part of the same company, the Orient Hotel. They had a dormitory room with a free bed so I took it. No lock on the door, just four beds in a room, and the shower and squat toilet nearby but not in the room, less than US$10 per night. The bed was hard as a rock and I slept in my clothes. Before going to bed I went back across the street to the Silk Road Hotel to eat, and had camel stew - something Yazd is known for. It was good - like beef, but more tender.
The next morning I was able to get into the Silk Road Hotel. Much better. Both of the places I stayed have a lot of backpacker type people. I was talking with a British couple who are bicycling. They had come from Esfahan by bicycle and are going to bicycle across Turkmenistan on a 5 day transit visa.
Here are a few pictures from Yazd. Unfortunately the hotel I am in now, in Shiraz, has a quota per user of bandwidth per day - so I can't post too much right now. When I arrived in Shiraz I took a taxi to my first preference place, and they were full, so I walked to the place I am staying now. It's good and cheap. I stopped emailing hotels in advance because they usually don't even reply. I think most of them don't even read their mail.