Of course you do, dramamama. Certain theaters are prime real estate. Producers carefully consider their proposed theater because 1) the number of seats controls their revenue, 2) certain theaters have a musician minimum with local 802 (whether it is a musical or not), 3) the rent varies by theater, 4) the literal location DOES matter as it impacts convenience, awareness, FOH visibility, etc., and 5) some producers are just superstitious and think some theaters are luckier than others.
take BOOK OF MORMON as an example. It is in a medium house. One could argue that if it were in a larger theater, it could sell more seats and make more money per week. However one could also argue that if it were in a larger theater, tickets would be easier to buy as there is more inventory, and ticket demand certainly gave this show buzz and word of mouth, contributing to its success.
take the Winter Garden as an example. Many producers think it is an ideal location because of its central Broadway spot, it's large marquee that you can see blocks away, and it's off the corner of the 1 train.
"The Spectacle has, indeed, an emotional attraction of its own, but, of all the parts, it is the least artistic, and connected least with the art of poetry. For the power of Tragedy, we may be sure, is felt even apart from representation and actors. Besides, the production of spectacular effects depends more on the art of the stage machinist than on that of the poet."
--Aristotle