Nobody really knows where the Aladdin tale comes from; it' probably the one tale in "One Thousand and One Arabian Nights" that didn't come from Arabic folk tales. Translators say it may have been invented by Antoine Galland, a Frenchman, in 1704. Galland may have made it sound Arabic and added it to "One Thousand and One Nights," which he translated from Arabic folklore.
English translations often said "Long ago in China" to start a story, and people assumed it was Chinese. But this was a common way for many Europeans in the 1700s to refer to anyplace far away.