Elance does divulge where these people live- you can restrict your hiring/contracting patterns accordingly.

Similarly, if you are up for reloing candidates, you're not restricted to a local hiring area.

Also, you can make your wants and needs transparent up front. If a freelancer doesn't like the idea of working in your office for a salary, they're free to be honest about it before you hire them for the contract.

I think it's kinda silly to imagine a site that's a crippled version of what's already out there when the existing solutions are more than capable of sufficing in this limited case.