I had to read your question a couple times. It seems like two different questions to me. One, which place of service is appropriate depending on the disposition of the patient? Two, which codes can be assigned to that place of service? Is that what you are asking?
This statement is a little confusing: "I should be billing only observation codes for outpatient hospital or emergency department codes of 99281-99288 with a place of service emergency department if service provided in the ED." You can't really use a blanket statement that you "should only bill observation codes for outpatient hospital POS". That doesn't make sense. You would code according to the documenation, disposition of the patient, who the attending is, CPT, and possibly the payer rules. It is possible that you would bill 99202-99205 for OP hospital POS and also possible for observation. However, if you are billing ED codes and the patient status was never anything but ED, you would use the ED POS and ED CPT.
The patient could be located in the ED "area" but their disposition could be admitted to observation (maybe there is no bed available, etc.). It goes back to the disposition of the patient. If you read the CPT instructions at the beginning of the Hospital Observation Services section, it explains this. Further, the instructions at the beginning of the Initial Observation Care and Emergency Department Services sections explain those.
The place of service would be assigned appropriately depending on the disposition of the patient.
You can also look to the CMS Manual for guidance:
https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/clm104c12.pdf
CMS instructions do not always match other payers.
30.6.8 - Payment for Hospital Observation Services and Observation or Inpatient Care Services (Including Admission and Discharge Services) (Rev. 2282, Issued: 08-26-11, Effective: 01-01-11, Implementation: 11-28-11)
"All other physicians who furnish consultations or additional evaluations or services while the patient is receiving hospital outpatient observation services must bill the appropriate outpatient service codes. For example, if an internist orders observation services and asks another physician to additionally evaluate the patient, only the internist may bill the initial and subsequent observation care codes.
The other physician who evaluates the patient must bill the new or established office or other outpatient visit codes as appropriate."
30.6.11 - Emergency Department Visits (Codes 99281 - 99288) (Rev. 1875, Issued: 12-14-09, Effective: 01-01-10, Implementation: 01-04-10) A. Use of Emergency Department Codes by Physicians Not Assigned to Emergency Department Any physician seeing a patient registered in the emergency department may use emergency department visit codes (for services matching the code description). It is not required that the physician be assigned to the emergency department.