Can I find the exact location of an email sent by tracing an IP address

Nope
Basically the closest you'll get is the location of the e-mail server that sent it and NOT the actual person.
So if it's webmail, like Hotmail, Yahoo, etc, you get to their data centres.

Good answer, however email headers can be forged, so that's a problem.

Sometimes email headers include the IP address where it was sent from, but it's not required.
I've sent email to myself with no headers. Don't ask.

If there are logs kept by the ISP, then the email can be tracked to an actual IP address that sent it which can ultimately be traced to an individual household. This is not within the realm of the casual user, but should be available to law enforcement by court order.