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Actually it's not. If you go to Google Search (the website) you'll often find it says your location is the same place the weather widget does.
It's just an issue of the Location Services not finding your location fast enough, and thus reporting some ridiculous default. I am not aware of a fix though, other than manually setting your city.
From launch day until earlier this week the HTC widget would update to the current area I was in and I could force that update manually if I wanted it faster than the 1 hour minimum available in the settings. Now it will not display anything other than one area all the while the weather channel app will show my current location. It without question is related to the HTC widget.
Okay, just pretend I didn't explain the proper way of checking it (The Weather Channel app doesn't always update location).
It's too bad we can't choose the weather service ourselves. Weather underground has a station less than a mile from my home. Perfect temp readings and weather.
I just started having a problem today where the weather portion of the HTC widget only shows the location, no weather data.
I suspect in my case there is a problem with the backbone weather system.
I'll update when corrected or if it persist.