Demiplanes

That sounds possible. But who would populate it?

What does it have that distinguishes it from Sigil?

The personality of the city would be radically different. Take New York vs. San Francisco - both are *large* cities, both are port cities, both do massive amounts of trade, both have famous bridges... but if you were dropped off in the middle of them without being told which you were in - you could tell almost immediately couldn't you?

Now the big thing for you - assuming that you're hoping for this city to have as many useful portals as Sigil - is that you'll have to figure out *how* a city with stable portals out to the primes and all is not under seiege as a useful trade and trafficking point from about half a dozen powerhungry folks. The LoP serves that purpose in Sigil, you'll need to find something for Nexus the same.

A god, a cabal of dracolichs, a trick of the plane itself where it blocks out those with a bad intent(*cough*ripoff alert), yugoloth quietly securing the place in the background - something has to keep the place from becoming the next big goal in Blood War troop movement or other such thing. You've gotta find something there or the place will make as much sense in the context of the planes as Union does. That is assuming you want it to be as heavily portal populated as Sigil though. You can certainly dodge around that by not trying to.

The idea of having the city constantly changing hands isn't a bad one actually. Esp. if the selection of portals involved is limited to some of the more lawful upp and lower planes. The reason I say that is those are the folks more likely to understand / respect the idea that if you fight a war, you don't want to destroy the infrastructure you fight over if you plan to use it afterwards.

Isn't there a Gatetown in the Outlands with a simular political turnover rate?

Is oaXs even stable enough to have politics?

I think a better match would be Plaguemort.

Often naturally.
Sometimes created naturally and shaped by spell (usually by someone who's heavily invested themselves into it *cough*xp cost.
Very sometimes by spell.

The Etherial (where demi-planes form) is the plane of Potential after all.

I imagine demiplanes would serve similar purposes in UP that they do in normal PS. Mages and deities would still want retreats, and there would still be a need to throw prisoners somewhere where they can't get away easily, and demiplanes serve those purposes incredibly well.

As for demiplanes created by technology, the idea of the Demiplane of Cyberspace by necessity makes that a given in campaigns where cyberspace is likely to be used.

Also, demiplanes CAN be infinite in size, just like regular planes. In essence, demiplanes can pretty well take on almost any of the properties of a regular plane.