Hello,
last month I bought my new Apple Watch S2. They are now running last watchOS 3.1.3. I have paired them with iPhone SE (now on iOS 10.2.1).
After few days of usage I noticed that "Motion and distance calibration" on Location Services > System Location Services is always ON. Even if the phone and Apple Watch are laying on the table during the night and not moving at all. I tried everything - reseting location services, network settings, iPhone restart. Nothing helped.
Then I tried to set iPhone as new and then restore from the original backup. For about 2-3 days the "arrow" next to the Motion and distance calibration was OFF (grey). Yestarday I run the Pillow app (sleep monitoring) for the first time and the MC turned ON and stays like this forever. So I thought some "Fitness" app which I granted access to motion activity (and M8 coprocessor) triggers it and once its ON, it will stay ON forever until iPhone restore. I got 6-7% battery drain from over night from 9 PM to 7 AM, so probably no big deal, but still it bothers me as its not the normal behaviour.
The pattern seems to be like this - after 10.2.1 upgrade, after 2-3 days from iPhone restore the MC turns ON and stays 24/7 ON no matter what.
I am starting to blame the iOS 10.2.1 (+ maybe watchOS 3.1.3) which both were realesed (and I updated both Watch and iPhone) one day later I bought the watch. And 2 days later issues with MC started.
I also got new iPhone SE as replacement, but I can confirm this is not the hardware issue as the problems with MC persist.