Carm's opened in 1926 as Fontano's, the grocery store that is now across the street, serving hearty Italian sandwiches. In the mid-'60s, Carm's separated from the Fontano store and dedicated itself to creating Italian beef sandwiches. Mary and Steve DeVille, Carm's owners, know almost all of their customers, who mainly live in the neighborhood and/or attend the surrounding University of Illinois at Chicago. Mary is proud of a new item on the menu ''for those of us watching our waist'': a chicken breast sandwich. From April through September, Carm's mixes Italian ices. The fruit flavors are really crisp--not loaded with heavy syrup.