Hopefully someone can add to this, but the location appliance, as far as I know, is a WLAN only location system. Its purpose is to analyze the controller data for the location of wireless LAN assets. Generally this is easily implemented with Cisco WCS + Location to dynamically create heat maps and track assets through WCS.
The MSE however is supposed to take this a step further and extend beyond just Wireless LAN. Although I have no experience with this, it is to my understanding the MSE is designed to bridge from a "service" level the gap between Wired/Wireless/Cellular needs.
So, if all you need is "location" information for Wireless Devices on a Cisco Wireless LAN, then I suppose the location appliance is for you. However, if your intent is to go the next level and implement wired and cellular information within some application service (and I have no of an example to give) then the MSE is the direction you want.
Please someone help elaborate on the details.
