Answer:
A. That ancient land was located in the Middle East, a hot and sunny part of the world.
Explanation:
It is grammatically correct and gets rid of the wordiness of two sentences.
Why the other choices are not as good:
B. That ancient land was located in the Middle East, and the Middle East is a hot and sunny part of the world.
This is basically the same as the original: there is nothing grammatically incorrect, but it is just too wordy.
C. A hot and sunny part of the world is the ancient land the Middle East.
This sentence changes it such that the focus is no longer on the ancient land or Middle East and rather on the "hot and sunny part".
D. Located in the Middle East, a hot and sunny part of the world, that ancient land.
This sentence is grammatically incorrect, because it has only a dependent clause.