From asking two 英語先生 and one 国語先生:
From both 英語先生:
The two are essentially interchangeable, with どこにありますか being the more polite of the two (as was mentioned above). One stated that they have a different “feel,” but couldn’t form an explanation for that.
From the 国語先生:
In line with what @Naphthalene mentioned, the difference between the two is relative versus actual position.
どこにありますか implies that the actual position of the object/position is in question rather than the way to it (so using this for directions is not advised). Inquiring upon a location within a location is appropriate use of this form. For example, if you ask a store clerk “where are the light bulbs” and want an aisle number instead of having them lead you there, this would be the better phrase.
どこですか implies relative position unless relative position is irrelevant. This is your generic “Where is…” statement, and the bolded text is why my 英語先生 determined them to be the same. To explain, I’ll return to the lightbulb scenario.
So the clerk told you which aisle the light bulbs are in: the Electricity Aisle. Seeing as you have no idea how to find it, you ask “where is the Electricity aisle.” Assuming this clerk is not a jerk, they’ll then give you directions or lead you there. This would be a likely どこですか case. If you asked どこにありますか, it would be more likely they’ll give you a reply like “beside the Water Aisle.”
However, when asking someone (not in or nearby Germany) where Dresden is, which you use doesn’t matter because, unless you’re in a conversation about German cities, likelihood is that whichever way you ask, the reply is “in Germany” (or Saxony, I guess, if your conversation partner knows their geography). Every student who asked me where my home state (in the USA) is used どこですか.
To provide the 和英 approach to this subject, the textbook my first years use in English class have the example question, “Where is the restroom?” The listed translation is 「トイレはどこにありますか」. The reply is 「階段の下です」(“Under the stairs”). The characters in that book have a tendency to have overly polite and use grammatically English Japanese translations though, so take that as you may.
Unless you’re planning on teaching Japanese, you probably don’t need to worry about the difference. If you don’t use あります in any of its other constructions like ではありません (instead you say ではない or じゃない), I’d say don’t worry about it and just use どこですか. Worst case scenario, just like English, is that you’ll just have to ask again with a little more specificity.