I have had an iMac stolen. Will the thief be able to disable the locator by swapping the hard drive or is the locator device in the mother board ?

Location is assessed by the assumed position of the wi-fi network it's connected to, and transmitted to you through iCloud; so simpy disconnecting it from a network will prevent you locating it. Any competent thief will wipe the drive anyway, there are a lot of incompetent ones out there; but getting a really accurate location is unlikely.

There is an article here which suggest that the Mac can indeed be locked:

http://apple.stackexchange.com/questions/59827/does-remote-wipe-securely-wipe-th e-contents-of-the-drive