My head-canon; Equestria takes place in post-apocalyptic earth, MLPonies=mutated horses from nuclear disaster, EQGirls= ponies millions of years in the future after FiM. Twilight went to the future in the movie. France exists, as Prance. If you look at Equestria's map, all the pun-cities take place where the original cities are.
This 'spoiler' is from the topic, "Is Equestria Located On Earth?" by BetaWolf ;
Ponies recreated old human cities and countries. Equestria=America, the part of Mexico that is not in the Equestria map=Mexicolt, France=Prance (they call it French because Prench doesn't work like that). Germany=Germaneigh, Saudi Arabia=Saddle Arabia.