It means both. If you want to express direction, you can also add i "to", so i ble "to where", and some people use yn "in" for the position, giving ymhle "at where".
So.. would, for example "ble mae'r ysgol newydd" be a grammatically correct sentence?
Ble is the contraction of ba le from pa le ("which place"), mutated so as to show adverbial usage. The English Wiktionary states that its mutated forms are used sparingly, because it already is a mutated form.
By the way, pa is cognate with Latin quid ("why?") (and more distantly with lots of other interrogative words like English when, what, who, why and how), while le, the soft mutated form of lle ("where") ultimately comes from Proto-Indo-European *legʰ- ("to lie, be in a resting position"), thus being cognate with English low, lair, lay and lie, and also with Latin lectus ("bed", whence Romance leito/lecho/lit/letto).