Do you want to specifically have GPS report a certain precise location, or are you trying to do a more general "I'm in Canada instead of the US" level?
There are VPN services that will make your internet connection appear to come from a different country - but as far as I know, there is no way to fake a GPS report. (i.e. no, you can't make "Find my iPhone" report you're at the library when you're really at the mall.)
It could be an active extra-marital affair, it could be he/she doesn't want the ex to track them, or it could be that he's job could be one of those 007 type of government jobs. Or it could be that he/she just has privacy concerns.
Or it can't hide at all. There maybe apps out there that fake ip origination points (I'm not a programmer or engineer), but yes the GPS log, phone tower log and Apple history log meta data it is impossible to escape location unless you leave the phone behind (probably even turned off).