@K
While your comments are pretty logical, they are also a perfect example of the lack of awareness guests have of how Airbnb's star rating system works. It's not the guests' fault, but Airbnb's for not educating them about it, or for not having a more sensible rating system in the first place.
No, of course we don't think we all have 5 star listings in every category, but Airbnb expects us to have 5 star ratings in every category, or they will penalise us in the form of no Superhost status, lower rankings (and therefore bookings) in the search results, threatening warnings and, finally, being removed from the site, all for having too many 4 star ratings.
Even if you forget about Superhost status, which so many of us work extremely hard to obtain/maintain, Airbnb's BASIC requirements for a host are: 4.7 out of 5 stars, 98% response rate (that's not about responding to 98% of queries, that's responding to 98% within a limited timeframe), 0% cancellations, plus a list of amenities that we must have. These are the BASIC requirements, without which you are at risk of having your listing removed.
To quote Airbnb re the above targets: "Targets represent the average level of performance for all hosts on Airbnb. They help us ensure a standard level of quality for every guest stay. Your listing could be removed if you consistently fall below the targets."
So, can you see now why a 4 star rating is actually very bad news for a host?
We therefore work really hard to get 5 stars in every category, but other than being as accurate about it as possible, Location is the one category we are unable to do anything about. That is why you will see hosts comment that if they were accurate about the location, a guest shouldn't rate them down on it.
Luckily, location is the one sub-category that doesn't count towards our overall rating as Airbnb admits that it is something the host has no control over (but still won't remove the category despite this). However, a guest can sometimes give 5 stars for everything else, but 4 stars overall because they didn't like the location. Plus, it still has an effect on how potential guests will view our listing. I believe @Sarah0 is right that if a listing has a low rating for location, many guests will be put off by this.
There is also the logic that the guest should do their research, which is usually as simple as reading the information the host has provided for them before booking, not complain about it AFTER! If the description of the location was inaccurate, then fair enough, but if not, it is the guest's error in picking a location not suited to their needs.
Sorry for the long response, but I think you comments really highlight the crux of the problem, i.e. Airbnb's lack of guest education.