Google AdWords has recently updated location targeting in the “Campaign Settings” section. It will now actually show you an estimated reach.
According to Google, “the reach estimate may differ significantly from census population data, because it is based on the number of users seen on Google properties. In addition, the reach estimate varies due to a range of factors, including the number of devices or browsers per user, the number of outside visitors to the selected location, and the length of user activity.”
This will now give you a better idea at how many potential users you are reaching in the areas you choose to target!