Successful message relay, or the quality of the inter-user channel, is critical to fully realize the cooperative benefits promised by the theory. This in turn points out the importance of the relative location of the users. This paper investigates the impact of the location on the system capacity and outage probability for both amplify-forward (AF) and decode-forward (DF) schemes. Signal attenuation is modeled using power laws and capacity is evaluated using the max-flow min-cut theory. The resemblance and difference between cooperative systems and multi-input multi-output (MIMO) systems are also discussed. Finally a capacity contour for DF, the more popular mode of the two, is provided to facilitate the derivation of engineering rules