Following up (3 years later) on this post, in which a commenter made the following observation:
San Leandro's story parallels a lot of the smaller suburbs on the edges of the older Bay Area communities. Albany was known for it's segregationist attitudes. I believe the drug store at the corner of San Pablo and Solano was the headquarters of the John Birch Society. There are several old bars with names from the KKK past, like the White Knight.
I think this establishment, now closed, is what that person was referring to. The Southern Knights bar is on San Pablo and 61st, right at the Emeryville/Oakland border. A name like "Southern Knights" certainly sounds like a not-so-subtle reference to the Klan. If anyone knows anything about the history of this establishment, feel free to leave a comment.
*Btw, I'm not back to blogging, at least not regularly. But apparently people keep reading this site, so I might as well keep posting.