Why is gps important?
Many apps use gps functionality to work. while wifi can be ok to give a general location (city) its horrible for pinpointing your location and canon be used for things like Turn By Turn Navigation.
I look at it like this... My stand alone Garmin GPS unit witch is just for giving location on map when out hiking was $500. This stand alone GPS unit has a 10 foot accuracy of your location. The GPS unit inside the iPads has a 15 or 16 foot accuracy. So for pretty close to the same accuracy you can spend $500 for a stand alone GPS unit or $120 to get the 4G iPad model. To me that is well worth the price of upgrade on its own.
If you don't know already, you should check out geocaching at geocaching.com. Its a fun game where you use your GPS to find real world hidden treasures left behind by other people in your area. When you find a geocache full of prizes you can trade a prize of same value(so there are things for the next person). Its fun and is world wide, you probably have a geocache hidden in your back yard and never knew it.