we are on the correct part of the map: north. if you have looked at the plan at the dragon empire forums, you'll see that we are placed perfectly. Anyway, our closest ally should be OS, not KO, although KO are also allies.
EDIT: we've started making some of the actual town. one underwater tunnel has been started, and the main tower has been expanded using the proper materials. I've also started expanding the treefarm to a decent size that also fits well with the main towers alignment.
One other thing, what is up with the cobble bridge thingy that has been set up? It looks crap, is not the way the finalized bridge is going to be, is one into the water so it's hell of a lot of work to remove it without getting whirlpools, and with this bridge raiders can get to us a lot easier. we should rather use boats to get to town. It's faster, looks better than a quickly made bridge like that, and we keep hidden and unaccessable for raiders.