The word "Mexican" descends from the ancient Aztecs, who called themselves the "Mexica" (pronounced "meshica"). The aztecs referred to their "country" as The One World. It was the spanish who called the land "Mexico", and referred to the natives as "Mexicas". The Mexicans of today descend mostly from Spanish and Aztec heritage.
It is not true that there are a lot of germans in Guadalajara.