River mostly in Devon placed in Sussex, erroneously (3)
I believe the answer is:
exe
'river mostly in devon' is the definition.
(River Exe)
'placed in sussex erroneously' is the wordplay.
'placed in' says the answer is hidden in the clue.
'EXE' is hidden within 'sussex erroneously'.
(Other definitions for exe that I've seen before include "River of southwest England" , "Current" , "River of SW England" , "Banker" , "River in SW UK" .)