Invented place names
Small, far away village: Hintertupfingen (https://de.wikipedia.org/wiki/Hintertupfingen), Kleinkleckersdorf, Kleinsiehstenich.
If you can't recall the name of a place you can call it Dingenskirchen.
Real place names
small, distant place
Posemuckel: the villages Podmokle Wielkie and Podmokle Małe in Poland. Posemuckel is used like Hintertupfingen.
in the middle of nowhere
Walachei: Wallachia in Romania
Pampa: grassland in South America
far away, possibly not even existing place:
Timbuktu: city in Mali
Timbuktu is not only in German regarded as a mythical place: "In the imagination of Europeans and North Americans, Timbuktu is a place that bears with it a sense of mystery: a 2006 survey of 150 young Britons found 34% did not believe the town existed, while the other 66% considered it "a mythical place". This sense has been acknowledged in literature describing African history and African-European relations. Timbuktu is also often considered a far away place, in popular western culture." (https://en.wikipedia.org/wiki/Timbuktu)
Funnily, we also have an urban myth in Germany that the German city of Bielefeld is a hoax and doesn't exist but this is just a joke and everyone knows that Bielefeld actually exists: https://en.wikipedia.org/wiki/Bielefeld_conspiracy. Or does it really?
Do you know similar invented or real place names in your native tongue or target languages to describe places far away, in the middle of nowhere, the back of the beyond?
That's interesting that actually existing and not so small Polish cities are used in Poland to express the idea of a small and far away place.
Shangri-la reminded me of the Schlaraffenland (Cockaigne). Different concept but also an utopia.
And well, about Bielefeld. You might find this funny: https://www.nw.de/lokal/bielefeld/mitte/22041816_Gag-mit-Karte-Wie-der-Bielefeld-Witz-Deutschland-spaltet.html
That's no proof. The Banana Bar was just a set for you to make you believe that Bielefeld exists.
Try Gügel, Gugelberg and Guglberg in the German Wikipedia.