Thanks everyone for the input. Indeed, this is ultimately a personal decision for our family so I am trying to weigh in on the matter in the most rational way that I can, because I know from a subjective point of view as a parent, it's hard not to feel some sort of emotion with the situation.
From what I understand, the store does have a legal right to be there as they and the school are private businesses. I spoke with the school regarding my concerns, and they did try to reassure me, and even suggested that I even visit the store to get a sense for what it is like (although personally, I will probably not as I am so averse to guns myself). Unfortunately, the school cannot do anything about the store being there.
The school claims that the people who own the store are respectful, friendly people who are indeed very professional, and their clientele as well. Supposedly they are like a specialty gun shop and sell many collector type of firearms. It is not a shady looking store, not in a shady area, and discreet looking. The sheriff/police are aware of the situation, and do drive by there occasionally to let their presence known. The school says that when the store moved in about a year and a half ago, many people were up in arms about it as well, and probably had to go through much of what I'm feeling now, but the fact that it is not much of an issue for them alleviates my worries (somewhat).
DH an I have been discussing it a lot. Yes, the likelihood that anything happening there is extremely low. Incidents/accidents involving guns probably don't happen right outside gun shops. But as a mom, it's hard to overlook something like that as you always worry about the safety of your children. We have yet to make any final decision. Although I was ready to pull my son out of the school the morning after I found out about the shop, after a couple days of letting it stew and talking to more people about it, I have a least decided to give it some more thought.
Thanks,
Sleepless