127.0.0.1 is the most commonly-known "loopback" address, that you've referred to, although RFC3300 (Request For Comments, imagine it like an formal set of rules for the internet) states that any address in the subnet 127.0.0.0/8 (ie. 127.0.0.0 to 127.255.255.255) can be designated as a loopback.

It's not really set anywhere, and it doesn't technically do any routing as it doesn't leave your computer (try unplugging your network-cable, and pinging it). It's normally hard-coded into every computer, switch, router, and so on.

The hostname-part will be due to NETBIOS working its magic. I'd explain in more detail, but apart from knowing that that's what it does, I don't really know that much about how it does it. More info on here, if you're interested...