Otoh is likely the same name the city had under King Banhammer. When refounding her side, Jillian lacked either the creativity or the desire to create a new name for the capital, keeping it as Faq, so it is likely she kept the name of Otoh as well.
Real World References
OTOH may stand for, "On The Other Hand."
This could relate to the philosophical history of the Kingdom of Faq. In philosophical discussion, many different points of view are taken into consideration. Taken further, we may assume there are different options available to the people in Erfworld, such as the one taken by King Banhammer.