I think the following query is more intuitive to understand
select max(Report_Result) as ReportResult, PARAMETER_NAME, GW_LOCATION_ID,
t.DETECT_FLAG -- all other columns can be listed here
from SLVs_Flagged s
cross apply (
SELECT *
FROM SLVs_Flagged
where PARAMETER_NAME = s.PARAMETER_NAME
and GW_LOCATION_ID = s.GW_LOCATION_ID
and Report_Result = s.ReportResult
) T
group by PARAMETER_NAME, GW_LOCATION_ID