I-5 may have come along later to bury Tumwater's historic downtown, but by the time it got there, Capitol Way had already stuck the knife in.
The best history of this, actually what got me started on this entire line of thinking, is Shanna Stevenson's chapter "A Freeway Runs Through It" in "The River Remembers." She points out that before 1936 the main drag through Tumwater dog legged through the old downtown Tumwater. After the current Capitol Way was finished in 1938, it bypassed the old downtown, leading to the creation of the commerical area down at Capitol Way and Trosper Road.
The red on the map below illustrates the new bypass, the blue, the old dog-leg road.
Going from crossing the Deschutes on a low bridge over waterfalls, the main road through Tumwater now crossed the Deschutes at a much wider point (a more than 1,000 foot span) over what is now the old (but then new) Tumwater brewery.
For over a decade before Interstate 5 uprooted the blocks old downtown Tumwater, the city was already abandoning its water-falls based history and moving south.