Which is great if you just want to know where you are (which is what it was designed for, obviously). But not so great if you're actually trying to do something you'd need GPS for (like geocaching). Two drawbacks here -- I've been trying the Locations feature around Chicago, and I've found that if I try it more than once, or am moving, the app picks up a little better on where I'm at. Also, I've been in Chicago, and Mac|Life is in San Francisco, so it would be interesting to know how this works out where we might really get lost-- out in the country, farther away from cell towers.
Still, while it's not as precise as real GPSers might like, the Locations feature is pretty amazing for what it is. Your iPhone doesn't know exactly where it's at, but it knows close enough to get you where you're going.