Creating an archive page or simple template to list all values of a custom field of specific post type listing

The first thing I would do, if I were you, would be to change the data structure so that the location would a hierarchical custom taxonomy where states were parent terms and cities their child terms.

Then you could create a custom taxonomy template for your location taxonomy. In this template you’d display list of child terms when the queried object is a parent term.

EDIT 3.9.2019

Here is a very basic example how to get the child terms in archive-{post_type}.php template

// WP_Term object
$current_term = get_queried_object();
// maybe array of WP_Term objects
$children = get_terms( array(
  'taxonomy' => $current_term->taxonomy,
  'parent'   => $current_term->term_id
) );
// If any child terms exists
if ( $children && ! is_wp_error( $children ) ) : ?>
  <ul>
    <?php foreach ( $children as $child_term ) : ?>
      <li><?php echo esc_html( $child_term->name ); ?></li>
    <?php endforeach; ?>
  </ul>
<?php endif;

A good place to learn more about custom post types is the Plugin Handbook, https://developer.wordpress.org/plugins/post-types/working-with-custom-post-types/

And if you’re not very familiar with PHP yet, have a look at the PHP documentation Getting Started guide, https://www.php.net/manual/en/getting-started.php, or use your preferred search engine to find tutorials and beginner level courses.

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