Realistically, someone in the Daggerfall player character's shoes would have to wander about for a while before reaching the nearest settlement, then ask about their location and directions to the City of Daggerfall. But implementing this in the game would entail actual wandering in the wilderness — not much fun!
So I was thinking a bit on how this could be changed while keeping the fast travel option in. What seems to me like a good solution is a secondary, alternate exploration fast travel mode. Basically, instead of picking a destination, you choose one of the eight directions to go to, and the character continues travelling (off-screen) until they come across anything of interest: a settlement, a shrine/temple, an inn, a dungeon, a road (if roads are implemented), or a random encounter, or an insurmountable obstacle (river, mountain, chasm etc.).
If roads exist in the game, it would also be possible to order to travel down the road until reaching any of the above, or a fork.
For this type of fast travel, it seems to be more useful to count travel time in hours (similar to resting) not in days, while showing how the player's stamina goes down, and include rest once it is low. Of course, the player should be able to stop fast travel of this type at any time. This would also allow for random (or quest-specific) encounters — something that does not exist in Daggerfall's fast travel and spoils some potential fun in those escort quests.
This should go hand in hand with the map that is not explored, to which any locations discovered should be added. Once you have definite locations on the map, fast travel of the regular Daggerfall type should be possible between them (maybe without the rest in inns option if there are actually no inns along the selected route).
I have no idea if any similar type of fast travel is implemented in any existing game
