When I was growing up, country music was known as "Country and Western." I don't know why it dropped the "Western" part. Perhaps it was deemed cumbersome to have two words, although it hasn't hurt R & B (then again, R&B flows more than C&W).
One thing it has never been called is "Southern." That makes sense, because you can pick up country stations just about anywhere; I distinctly recall at least two in the Detroit area, home of Madonna, Eminem, and Motown, about as un-Southern a place as you could imagine. (Although people around there did joke that the suburb of Taylor was really "Taylortucky.") Heck, even Detroit native and eponymous rocker Kid Rock has moved into country music.
On the other hand, it is kind of hard to escape the fact that most country musicians come from the South. I just checked some of the biggest names on this page, and over half were from the South. Some were from the Midwest (Illinois, Ohio, western Pennsylvania, the Canadian plains), but not one came from New York or New England. I'm sure that country music promoters are happy to downplay this aspect of country music so that they can appeal to a broader audience -- and I don't blame them -- but it is difficult to ignore the frequent references to Southern places in the music. Few singers are as overtly enthusiastic about the South as Hank Williams, Jr. ("If Heaven Ain't A Lot Like Dixie"; "If the South Would Have Won"; "That's How We Do It In Dixie"; "Dixie On My Mind"), but it is only natural that they set their songs in the places they know best; and love of one's home is a frequent theme, as one would expect in Southerners ("These Are My People" by Rodney Atkins, "Chattahoochie" by Alan Jackson, "My Town" by Montgomery Gentry, My Home's in Alabama by Alabama, Hey Porter by Johnny Cash, Chicken Fry by the Zac Brown Band). Admittedly, many of these could apply to small towns in other parts of the country, but in other cases, they could not. I often wonder how people from, say, Massachussetts feel when they listen to these songs, and whether the regional aspect doesn't make it difficult for them to enjoy it.