"Where is the restaurant?"
Correct. こ<sub>/そ</sub>/あ<sub>/ど</sub> words change meaning depending on the ending syllable. ~れ is an object; ~こ is a location; ~の is an object and must be followed immediately a noun. One special rule is if there are exactly 2, it changes to ~ち. A weird thing to this foreigner is, it's あれ, あの, and あち for objects, but あそこ for location.
Famous examples: これはペンです。This is a pen. どれがペンですか。Which is the pen? どこがペンですか。Where is the pen? あのペンはあそこです。That pen is over there. どちがぺんですか。Out of 2 objects, which is the pen?
I don't know why you were downvoted for this. I don't understand why the word "sono" appears in the Japanese version of this sentence, either. I can't think of any logical reason why anyone would want to translate the phrase "the restaurant" (rather than "that restaurant") as "sono resutoran". It makes no sense!
We have to think of the sentence in its context first. The question is :
Where is the restaurant?
If you're wondering where the restaurant is, then it cannot be "this restaurant" since you're not there yet, it remains "that restaurant" for now.
Knowing その works, then あの should probably work too, but この won't make sense in the translation, unless you were asking "where is this restaurant".
Hope it helps!
Say your friend was trying to take you to a restaurant, but is having trouble finding it. You are walking along, and have changed the conversation, but suddenly see what you believe is the resaturant you're both looking for.
Could you use そこin this same sentence structure to mean "Is that the restaurant?" (ie. "レストランはそこですか？”). As opposed to something like ”それはレストランですか？” Which is more appropriate? Or would you use something entirely differently?
You're right, but I just wanted to add that you can just leave out は in speech, if you replace it with a pause. Typically that's written as 「レストラン、どこですか？」 and though it is technically grammatically incorrect, it follows a widely accepted convention. The meaning is pretty unambiguous too, unless you are talking to someone named レストラン.