This is actually a real place, in Spain as a matter of fact. Here is the relevant wiki-link: http://en.wikipedia.org/wiki/Valladolid.

It is a city, and judging by its location it might have been meant as another province in spain or as something to replace Leon. There aren't many references to it that I've seen but it does appear to be something that was in M2TW at some point and then removed. Interesting stuff.