The SCHEDULE ratings represent what the rating would have to be for a
hypothetical team to have a mathematical expectation of winning precisely 50%
of their games against the schedule played by the team in question in the games
that it has played so far. The schedule difficulty of each given game takes
into account the rating of the opponent and the location of the game. This
is the same concept that is used in computing the WIN50% conference ratings.

Location is indeed a factor.

The metrics being developed for the selection committee, by SportSource Analytics will take this one step further and include the opponent's opponents into consideration.