I’ve always thought of hyperlocal as a word much like queer. Local journalism has for the longest time been viewed as a gig you do at the start of your career, something that sophisticated readers should just skip in favor of a good national daily, as more fluff and crime stories than real meat. So to call your own reporting hyperlocal is to say, “Not only am I doing local news, but I’m damn proud of it, too.”
Etymologically accurate? Probably not. And it doesn’t describe the smaller-than-local focus of neighborhood blogs or an aggregator like EveryBlock. But I kind of like my explanation anyway.