A Location is the type of area you are currently at. In Salt this could be the Ocean, or on a Desert Island. This is not to be confused with a Landmark which is an object or feature of a location that is easily seen and recognized from a distance.
Locations in Salt can vary greatly or very little between each other. This page gives a brief overview on what the player may find at a Location if certain things are present, such as ancient islands, pirate camps, etc. Normally the player can tell from a distance whether or not there are campfires, ruins, or beacons around the island and from these three things you should be able to determine what you're likely to find on the island.