Jaracuaro is just outside Patzcuaro along the lake.  It sits on a narrow penisula that used to be an island.  The streets are very narrow and unless you have to drive to the far end of town, it's better to park near the store with the welcome sign and walk in.  Jaracuaro is only about 20 blocks long and a few blocks wide.
The hat makers shop is just 2 blocks along the main street on the right.  A very friendly family and they are willing to give you a tour of the shop and showroom.