Would Suikoden VI take place on the "Western Continent&

[Avalionis]

Gate Rune Village itself is said to be "Harmonian" (just so you know).

Hidden Rune Village was speculated awhile back that it was "Grasslandish".

Blue Moon Village, where Sierra had her "log cabin" hermitage, was during a time where "nations where rising and falling"; this area sounds to me like Harmonian policy at play (Thus Harmonia being my speculation). As well the "Marley Domain" being a Neclord sacked region of Harmonia points to the vampire thing as well. Just to conclude Harmonia has a thing with True Runes making it a further credible place to have Blue Moon Village.

Ahh...right. I forgot all about Marley being from Harmonia. >.<

I heard rumors that Harmonia had attack the Village of the Gate...so I guess it would make sense for the village to either be IN or AROUND Harmonian territory.

I kinda wished they had a small empty plot of land in a forest in Grasslands that you could visit. (being the hallowed remains of the Village of the Hidden Rune)

[BlackKnightYuber]

I was led to believe that the kingdom of Zelant was a large island mass thats not connected to the western continent, its only closer to it then it is to the southlands or the mainland.
Gaien could also be another candidate for the next Suiko to take place, was mentioned in the last 2 games.

I believe you're right about that. According an map drawn up by the great John Layfield of DueFiumi fame, Zelant is an island mass to the west of the Gaien Dukedom. It's also the closest known populated land to the Western Continent. This is apparently canon, though I wouldn't know where to direct you to check on that.