In response to Glowing Fish's node. (above)
It's quite simple, really:
Use in when referring to being within a bounded area. i.e. Your location is inside the set of locations that form the area.
On is the preposition used whilst upon a real thing.
Examples:
I am in a smelly cage.
I am on the table.
I am standing on the grass.
I am standing in a horse paddock.
I am thinking on an island.
I am thinking in Ireland.
As long as you can discern if your object is an imposed set or physical structure, you should be okay.
This can occasionally be quite tricky. For example:
as jasonm pointed out "the stage" is an area, but it's also a physical thing. The correct preposition in this case is 'on'. The best way to motivate this choice is to look at the development of the stage, initally it was just a raised platform which the actors stand upon.
Such peculiarities do exist, but we can always attempt to generate
some rationale or other as to the motivation for the choice. This generally stems from the sense in which the preposition is used.
The language does have some exigencies, but taking the time to analyse and understand it helps too.