What is the Category Top Description in GD CPT Category Settings (screenshot attached)?
It is a rich media field where you can add html to describe a category or category+location.
Use the GD > Category Description field to show the information on the location page.
It is said that “This will appear at the top of the category listing”. What is the Category listing? Does this mean the Category Archive Page? Then, two Descriptions appear in a Category Archive Page? Which is the purpose?
It is referring to the category archive page. Only category top description is used by the GD Category Description widget.
What is the setting “Use main description for all locations”?
You can set a single ‘main’ that will be the default, then add for each location.
What are the location tags below that setting? Where and how they should be used?
Those are replacement tags. Add them to the text and they will be replaced with the value.
Please read the doc here: https://wpgeodirectory.com/docs-v2/places/categories/