Well, the widely reported rumors were true, and today Apple released the 1.1.3 firmware update for the iPhone which provides location awareness, using cell phone triangulation. My first quick test had a much better result than I expected:
Incidentally, the photo above was automatically uploaded to flickr using my new-ish Eye-Fi card, which is a pretty cool gadget in case you haven't come across it. It's an SD card which includes Wi-Fi, and once you've done some setup, it will immediately upload pictures wirelessly to flickr or other online photo sharing services. I don't always want to do that, but for situations like this where you just want to take a photo and get it online quickly and easily, it's great!