my story is entirely fictional. How does any of this potentially map onto our real position in the Milky Way. This is a fun worldbuilding question. Here is how your setup maps onto real galactic geography.
Galactic north is a real concept. It refers to the direction perpendicular to the plane of the Milky Way’s disk, on the side toward the constellation Coma Berenices. Galactic south points the opposite way. So north and south in galactic terms means up and out of the disk, not toward the core or the rim.
Where Earth actually sits is in the Orion Arm, which is a minor spiral arm about two thirds of the way out from the galactic center toward the rim. We are embedded in the disk itself, not above or below it.
How this maps onto your story. If the Coalition occupies a volume of space centered roughly on the galactic disk, then its northern and southern frontiers would be the regions extending above and below that disk plane into the halo, which is sparse, ancient, and mostly starless. That actually makes for excellent frontier territory since it is genuinely remote and thinly populated with stars. Your story being farther from the northern frontier suggests it is set deeper in the disk, which is denser with stars and more plausible as settled, contested, or politically organized space.
One useful framing. Think of the Coalition as a roughly pancake-shaped volume of inhabited space lying in the disk. The northern and southern frontiers are its top and bottom edges where the disk thins out into halo. Your fictional system sits well inside that pancake, comfortably away from the sparse upper frontier.
Nothing about this conflicts with real galactic structure, and it gives your setting an implicit logic even if you never explain it directly to the reader.
So I could easily dispense with galactic north and south and simply think of it as the “north” of the pancake and so forth. I assume the arm earth is located in is quite big and the star system in the story could be further out toward the rim or just a wee bit closer to the center.
Yes exactly. North and south just mean the flat faces of the pancake, and you can treat that as pure convention — someone in the Coalition’s history decided to call one face north and it stuck. It needs no further justification.
As for the Orion Arm, it is actually one of the smaller arms, a spur rather than a full major arm. The two dominant arms are Perseus and Scutum-Centaurus. So there is plenty of room within or near the Orion Arm region to place your system a bit rimward or a bit coreward of Earth without straining anything. Rimward gives you a natural sense of being further from civilization and closer to open, uncharted space, which suits frontier-adjacent storytelling well. Coreward trends toward denser star fields, more ancient stellar populations, and historically more contested or developed space in a lot of sci fi conventions.
Since your system is entirely fictional you have wide latitude. You could gesture at it being in a quieter region between arms, which are real sparse zones, or nestled in a smaller spur. None of that requires you to name real stars or commit to a precise location. The reader will never know and you never have to know either. What matters is that you have a mental picture that feels consistent to you, and what you have already sketched out is plenty coherent for that purpose.