I use different item locations all the time, it's fine. Keep in mind that eBay allows you to set it on your will for a reason: people may not necessarily have the stocks with themselves all the time.
It's perfectly fine. For example, if you're in the USA but drop shipping from Hong Kong or China, you're supposed to put that location where the item comes from.
yeh its absolutley fine...i used to have a UK ebay account and was shipping stuff direct from china with the location as Hong Kong.....never had issues with this..