Even if it’s the old thread I’m just replying here so others with similar issues will get the answer. Based on the Apple support reply, Apple Watch’s GPS (cellular model) doesn’t work well without a good cellular coverage. So, based on that it doesn’t have a fully functioning GPS module. If I have the only one bar showing, the location is not updating on a timely basis or may not even showing at all. In other words you won’t be able to track let’s say your children in a poor covered signal area through Find My app from your phone. In a good coverage areas the location is working and visible from FindMy app. If you live in the area without a full bars 5G coverage, don’t buy it if you need to use GPS on your watch on the regular basis.
Apple should prevent a confusion and make a statement on the watch website that the location service is only limited to a good coverage area and doesn’t have a fully functional GPS module like some Garmin tracker for example.