Setting the policy lets you set a list of URL patterns that specify sites that are not allowed to access the user's geolocation, and are also prevented from requesting user permission to do so.
Leaving the policy unset means DefaultGeolocationSetting applies for all sites, if it's set. If not, the user's personal setting applies.
For detailed information on valid url patterns, please see https://chromeenterprise.google/policies/url-patterns. Wildcards, *, are allowed.