The city it resolves to is where my isp has their HQ.
However, there is a different kind of GeoIP that has the potential to be much more specific as to the location, based on a join between Internet traffic and transactions that target a specific location. e.g. when you purchase a physical item from an online vendor, with your house as the delivery address, they now have both your IP and location. Obviously for this to work it depends on a) the IP address remaining the same for some period of time and b) sharing of the necessary information to allow the join. afaik both are often true.
Seems Comcast maps IP (which they issue) to postal address to exact Geo coordinate.
I am sure the NSA does better but Kazakhstan? I have been inside one of their embassies to be shocked that they were watching the news on a black and white CRT TV!!!