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The actual origins of the word "Dixie" is lost to the speculations of history, but one of the more accepted theories traces it to a ten-dollar currency circulated in New Orleans in the early 19th century.  [Upon] the bills was printed the French term "Dix" (ten).  Locals referred to them as "dixies", which gradually came to mean the city at large and, eventually, the entire South.

Later, of course, Daniel Decatur Emmett wrote the famed song "Dixieland."

As an historical entity, it is properly defined as the 11 states that seceded to form the [Confederate States of America] (SC, MS, FL, AL, GA, LA, TX, VA, AK, TN, and NC).  This is the historical and traditional South.

In more modern times, Dixie's location in popular mind-set has evolved somewhat, and is usually associated with  states -- or portions of them -- of [the Deep South] where Confederate and "Old South" pride live most strongly. As well as where the image of "moonlight and magnolias" is very rooted in reality.

Roughly, it would be an area which begins in southern Virginia and extends south into the [Florida panhandle].  On the northern boundary it sweeps west to take in Tennessee (and perhaps the southern parts of Kentucky),then westward thru most of Arkansas.  On the southern end it runs thru the Gulf states until the northern and southern boundary lines connect to include and take in East Texas (generally, that part of the state east of Dallas).

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