It's both. On its own, your Datum would be the derived center axis of the measured OD of the groove. Because this is also a feature of size, material boundary comes into play when this datum is used in a DRF. That's when things become interesting. For ASME Y14.5 (not familiar with ISO) the datum becomes a cylinder of the minimum circumscribed measurement of said OD. It will then derive the axis from that measurement option. If this datum was called out at MMB, then you would get more relief (bonus) as the OD got smaller.
If the majority of this part is turned, then it makes a bit more sense to have it established as the primary datum. I would imagine there are also implied or hard callouts for concentricity or position to this feature.
It's both. On its own, your Datum would be the derived center axis of the measured OD of the groove. Because this is also a feature of size, material boundary comes into play when this datum is used in a DRF. That's when things become interesting. For ASME Y14.5 (not familiar with ISO) the datum becomes a cylinder of the minimum circumscribed measurement of said OD. It will then derive the axis from that measurement option. If this datum was called out at MMB, then you would get more relief (bonus) as the OD got smaller.
If the majority of this part is turned, then it makes a bit more sense to have it established as the primary datum. I would imagine there are also implied or hard callouts for concentricity or position to this feature.