The primary location setting is per site. It does not mean it is the only location for that item. This means that for each item, you can have a primary location set in each site in your database.

The mobile device will not populate the location until it knows which site it is working with. If you only have a single site, then obviously that is always the correct one and the device will always use it. If you have multiple sites, either you can select the site you are working in and tap the Site field name to pin it, so it will apply to all transactions entered until you leave that screen, or you can go to Tools > Site Configuration to select the default Source and Destination sites, which the device will then use for all transactions. Once Site is populated on your transaction, either by one of the above conditions or by entering it manually, then if the item has a primary location set in that site, it will be selected automatically.