Location is a property of an object.
For a thing or a player, location is the object in which the thing or player is contained. A thing or player may be located in a room, a thing, or a player. A related concept, the absolute location, refers to the outermost containing object (which must be a room).
Considering the realities of the physical world, one would expect that you should not be allowed to enter something you are ultimately carrying. This would create a circular locational reference with no outermost containing object.
PennMUSH attempts to prevent circular location references.
TinyMUX does not attempt to prevent circular location references. This implies that loc() sometimes returns #-1 (nowhere) and softcode should expect this.