What is the significance of an Azure Resource Group location

Usually when you create a resource group for a certain location, resources in that resource group can only be created in that region. There might be a few exceptions for Azure managed services which are served from a central location. You should always create a support request to let Microsoft investigate it and provide a fix if needed. The location is Metadata of the resource group, and a resource group is a container of a workload. Unless it's multi region you don't want to have your resources spread across regions. In my experience that metadata is inherented by the resources you create in a resource group.

Edit I was wrong within a resource group you can create resources in different regions. But I wouldn't recommend it. Just to keep it simple and have a good overview. Having resources in a resource group in different regions just creates a mess I think. As a design best practice create resource group in different regions but keep the resources in that resource group in the same region. And if it's one workload or application cobsider the geographical proximity of Azure regions to your users or other services. Choosing a region close to your users can reduce latency, resulting in better performance for applications.(according to the Azure well architected framework). When you have users all over the world I would recommend looking into azure front door. Azure front door has a global presence within the Microsoft network and can present the application from a location as close to the user as possible, it can also integrate with a cdn.