Had this happen in my 3rd game. I was aiming for a cultural victory and Aztec came from across the ENTIRE continent to settle right where I needed to put a city. I took it with 2 warriors since he left it undefended, but it ended up costing me later on. He was never willing to sue for peace without asking for tons of gold and a bunch of my resources I only had 1 of, so I kept declining. Since we were perpetually at war, he was also at war with my allied city states and eventually killed 2 of them, costing me a lot of gold I had spent bribing them. As I was off trying to defend another one, my neighbor who had been pretty friendly with me most of the game declared on me and I couldn't get my troops back in time to fend him off.
I guess I understand why they do it since there's no longer a distance cost, but I have a really hard time believing that he didn't have any better options closer to his capital to grab resources (all he got was 1 happy resources with the placement he chose). His settler must have traveled 20+ turns just to get there, and it based on when it was settled, it had to be only his 2nd or 3rd city.