The location is where your Vagon computer is located. Vagon chooses the best placement between location options in the sense that you will have the smoothest experience!
It is important to stick with that option on initial setup because if the distance between you and Vagon computer increases you may experience noticeable lag or latency issues. As it is seen below, the change in the location of Vagon computer may cause latency and decrease in the quality of your session.
In this case, Vagon computer is set in Dublin which is the best possible location for our experience and our connection experience will be Smooth.
If you want to change your location, in this case from Dublin to California, there is a high chance that you may cause decrease in the Vagon experience. As it is seen below, your connection quality was Smooth, but if you change your location to California, it becomes Acceptable.