The USA uses 'city' to refer to a district --- it's a unit of administration rather than strictly referring to an urban area. It's quite possible for a city to contain rural areas.
California seems to be an exception where my GPS will report a city quite far away as "where I am now" when I'm in the sticks, but that might be my GPS. California is also less particular about administrative division naming than, say, Michigan.
City, town, village, county, parish, and township all have particular meanings that vary across the country. This is not an area where one can say "the USA" and be correct, as with many things in our really-50-countries patchwork. One example is that Wisconsin dubs "towns" what Michigan calls "civil townships."
America is confusing, even before you get into the debate over New Urbanism.
Cambria is in San Luisbo County which has an area of 3600 square miles and a population of over a quarter million but only 5 cities. California has a law that makes in almost impossible for a new city to incorporate. The new city must reimburse the county for any lost tax revenues caused by incorporation. If your GPS reports a city some distance away, it probably reporting the county seat of an unincorporated area.