Currently US, Australian states etc are compiled on one table which looks unprofessional and results in frustrations for users searching through irrelevant states
Most other shopping carts or online sign ups will have country specific states listed once country is selected (they ask you to do this first) and this is the expectation from users
I spoke with customer service, and you cannot update it, as Nicole S. mentioned below. It's unfortunate. We have a much older demographic, and I know this will confuse them!
You should be able to clean up this table in configuration.