Does your WiFi iPad show your location incorrectly?
It is very likely something in your wireless router. Unless you are using a 3g iPad with the 3g cell towers triangulating your position, your iPad uses something that is broadcast from wireless routers around you...and you do not need to be connected to that router for this to take place. The iPad appears to read the strongest wifi signal and sets your location based upon what location that particular router you are detecting is reporting.
I bought two wifi iPads, one for myself and one for my Mom. I set both up at my house. I have the widely popular Linksys wrt54g2 router. Both iPads hit my location very quickly and are quite accurate. I then took my Mom's iPad to her house with a Tenda router and the map starts showing my location as South Korea! If I walked down the street one way about 100 yards, it would lose her router's signal and pick up one down the street, jumping the location back to my vicinity. When I walked back to her house, it took me back to Korea. I walked up the street in another direction and back again, with the same results.
After thinking this through, even considering that maybe her house was on top of some phenominal magnetic or radioactive deposits, I finally got down to unplugging her router and bam! I was instantly transported back to a logical location position. I took her iPad back to my house, and location works correctly on both iPads. I can also recreate the issue with my own iPad. So there is no doubt it is her router. BUT, I cannot find anything in the Tenda router's setup/settings web page that fixes this. I have changed the date and time and time zone on the router, rebooted everything multiple times and still no luck. I wanted to share this with the community so anyone else with similar issues might gain some insight.
I'm going to dig into the router a little deeper and come up with a solution to get it to report it's location properly. I have a feeling it is something in its SSID broadcast since I have validated that it is not necessary for the iPad to be connected to a router in order to get its location.