Ha, looking at lemon lover's comments about a place on the Pudu river. We were following the river north of Yangbi, and there are hot springs there. The locals had built a concrete block shed around a pool Two problems, firstly was the litter, secondly the whole area by that river, because it was warmer, was alive with flies, the big house fly type. We still camped there, but it was days before we got all of the flies out of the car.

Yes, Xishan has several government sites. The Taiping side has places, but no view. Once you get north of the G56 highway, there could be some nice places up around Bamboo Temple facing Kunming, and out towards Fumin across mountain trails. Look at GoogleEarth, not blocked.
Heading south from Xishan, on the west side of Dianchi lake, once you pass Bainidong (8km south of the cable car way), you should also be clear.
You really want to be above the road, not below on the lakeside, if you want to avoid being seen.