Internet IP addresses were never intended to have any sort of relationship with the physical location of the computer.
Agreed. I don't think that was intentional rather they simply had to reduce scope to get the basics working. I'm sure if they started anew, it might be considered.
For history buffs, from RFC 791 which was published in Sept 1981 (bolding by me)
The internet protocol is specifically limited in scope to provide the functions necessary to deliver a package of bits (an internet datagram) from a source to a destination over an interconnected system of networks. There are no mechanisms to augment end-to-end data reliability, flow control, sequencing, or other services commonly found in host-to-host protocols.