I actually think it's an allegorical representation of the whole world. I think the Long March, crossing the sea of fog, etc is just a metaphor for death. The badlands are the Afterlife.(think mythology Afterlife not Christian)

All the Reed stuff from the DLC makes me think the Land of Reeds might have existed in the Lands Between at some point.

Also the Egyptian Afterlife is basically a Land of Reeds.

I know this isn't a popular postion but I think it makes the most sense.

The Chapel of Anticipation is what it is because the Anticipation the resurrection of the Tarnished. It's in a place they can't be consumed by the Erdtrees roots.

We also have all those above ground coffins that could be above ground for the same reason. So the Erdtree won't consume the Tarnished.

This also ties into the Ragnarök allusions in the game.

Just a different perspective.