The Repository Location is set once for the portal and affects all modules in the portal.
It can be set by the portal Administrator; however, I do not see any way to restrict setting the Repository Location to the Host (SuperUser).
Since it can point to any directory the Admin can circumvent security by pointing to a directory that is used for another portal or even a system directory. On a hosted implementation this could allow a single portal administrator to bring down the whole server. Take the following example:
Repository Location = C:\Windows
Change Extensions = False
now upload a replacement for any of the Windows system files, for example. ntkrnlpa.exe!
Restricting Repository Location to SuperUsers only (or at least an option to restrict it) will prevent portal Admins from bypassing security on a server that hosts multiple portals.
(Likewise, there should be a way to restrict WebDAV permissions SuperUsers only.)