Learn English – Finding fault (with / in) (someone / something)

EDIT to Add:
A cafe is at the corner is a perfectly fine English sentence. Even The cafe is on the corner is fine--even if you have never heard of this cafe before. Someone can tell you The cafe is on the corner.

Origial answer:
This is an arbitrary rule that is limiting your ways of expressing things. Both sentences are fine. The use of "there is' is the so-called existential construction. It puts a "dummy they" in as the subject and moves the real (or "logical") subject of the verb to the predicate side of the verb to be.

As the wikipedia description says, this construction is used to refer to the presence or existence of something, from There is a God to There is a turd in your commode.

So, "There is a cafe at the corner" declares the existence of a cafe at the corner. However, in a description of a town, A cafe is at the corner works as well. Either one works fine when giving directions, although the existential construction may be more common.

One can also say Here is a cafe at the corner and, again, There is a cafe at the corner, showing that these uses of there and here are deitic, which just describes something from the place in space of the speaker. "There" would mean "over there at that corner" while "here" would mean "right here at this corner." Note the change from the determiner the to the deitic or demonstrative pronouns that and this, which both also reference the cafe from the place in space of the speaker.

The difference is generally active vs. passive wounding. Someone causes a wound to a body part (active), while you can have a wound on a body part (passive).

Which you use depends on context:

The assailant inflicted a number of lacerations to the victim's arms and torso.

The victim has a number of lacerations on his arms and torso.

You can shift this the passive voice, but the preposition still indicates some kind of action:

A number of lacerations were inflicted to the victim's arms and torso (by the assailant).

or

The victim received lacerations to his arms and torso (from the assailant).

To put it another way: In general, use to when referring to an action that causes a wound, and use on when referring to a situation where a wound exists.

Keep in mind this is only a rough guide, not a rule. Some people will prefer one over the other, or switch it up based on what sounds best to them.