It was mentioned that Herobrine's castle was near Shadowbrook. It can also be assumed that it is located in the Frontier, as that is His land. After looking around the North-Eastern Frontier Peninsula, it came to mind that the mountains would be a nice location for a castle. There is a evidence against this in 8BW3, when the Lost Legion confuses Villagestown for Herbrine's castle, so while it is possible that they had prior knowledge of the castle's location, it is unlikely.
There is a group of mountains southeast of the marked location, it is a candidate as well.