Black Lotus is usually located around the buildings at the ends of the roads in Mooshu.
Another way to get Black Lotus is through gardening, particularly Pink Dandelions and Evil Magma Peas. Pink Dandelions drop frequently from the blue Mander slaves in the Sphinx of Krokotopia. They reseed themselves and are relatively easy to care for. Evil Magma Peas are crowns only, but sometimes drop from bosses in higher worlds.