Actually now when I really think how I would say "closest Bakery" I would say "nächste Bäckerei" :D So maybe you are on the right tracks. There really isn't a simple way or common to say "closest" (in the location sense). It would be too complicated. "Wo ist die nächstgelegene Bäckerei" or something like that ;) (which I doubt many Germans would prefer over "nächste" when they would like to know where is the nearest)
Yes, and to add, "nächste, -r, -s" is both the German word for "next" and the superlative of "nahe, -r, -s", meaning "close" or "near". So "nächster, -r, -s" is not only the simple and common way to say "closest" or "nearest" (in the location sense, as you say), but it is also more or less its literal translation. And you are right about "nächstgelegene" (literally "most closely lying", meaning simply "nearest" or "closest") being too long and complicated to be used much in everyday speech.
Thanks for the clarification! I remember learning that at some point, but had forgot about that. Makes sense.
A funny thing: literally just few minutes before I read your message, I had read the sentence: "Sie wurde aus nächster Nähe erschossen" in a Krimi that I'm reading. Which nicely proves your point and gives a nice context so that I won't forgot about that again ;)
The Standard High German "ch" is never pronounced like "k" or "hs", but there are two different pronunciations of the "ch" depending on which vowels precede it. For example, "nächste", "ich", "nicht", "wichtig" etc. all use the "soft ch", while the "ch" in words like "Nacht" or "nach" are pronounced "hard". E.g. this video explains it quite well and gives many examples you can listen to.
I wouldn't see it like that. Only the combination "chs" can be, if it is part of one syllable, pronounced like "x" (or "ks"). A "ch" on its own shouldn't be pronounced like a "k". In this case the "s" in "nächste" comes from the superlative "st", so that this is not one of the aforementioned "chs"-combinations, but the normal rules for "ch" apply. I see how it could seem tricky to differentiate between a "chs" and a "ch" which happens to be followed by an "s", though.
As you know the "ch" has two pronounciations. After "a", "o" and "u" (deep vowels) its always a voiceless version of an "r", in the phonetical language described by an [x].
For instance: "lachen" (to laugh), "das Loch" (the hole), "suchen" (to look for)
The other version is phonetically described with a [ç] and will be used in all the other cases:
"der Becher" (the mug), "mich" (me), "die Löcher" (the holes), "lächeln" (to smile), "süchtig" (addicted), "durch" (through)
In some regions of Germany they prefer to speak the [ç]-words with a "k". For instance: "Kina" instead of "[ç]ina" for China. And the word "nächster" will be pronounced like "näkster" instead of "nä[ç]ster".
In Switzerland they never use the "[ç]"-pronounciation. They always substitute it by the [x]. Its a typical swiss accent ;-)
In this situation one would simply say: "Wo ist die nächste Backerei?" A little bit more formal is this: "Wo ist die nächstgelegene Bäckerei?" See http://www.canoo.net/services/Controller?input=n%E4chstgelegene&service=canooNet
I wouldn't say "Wo ist die naheliegendste Bäckerei?" because I think that "naheliegend" mostly means something like "wahrscheinlich". E. g. you can say: "Die naheliegendste Erklärung für den Stromausfall ist ein Defekt in der Trafostation." (= The most likely reason of the power outage is a fault in the substation.) But according to canoo.net "naheliegend" may be also used with the meaning "nearby": http://www.canoo.net/services/Controller?input=naheliegend&service=canooNet