GPS is certainly integral to the future of mainstream computing...
I've been loudly trumpeting the importance of google earth for a while now. I believe it will soon be google's crown jewel. Searching is nice, but a searchable, zoomable, layerable, 3d view of the earth will eclipse the significance of mere text searching.
Portable devices become truly useful by providing location aware functionality. While this is probably obvious to most, I have a feeling that the significance of location-aware computing is still underestimated.
iPhone could sense that you're at Home Depot and remind you to pick up more steel wool (don't ask)
iPhone could sense that you're at a theater and turn off it's audible ringer.
iPhone could see that you're still at home, that it isn't a holiday, that you're late for work and wake you up.
iPhone could direct you back to your your car after losing it in a mall parking lot.
iPhone could sense that you're walking to the parking lot after work, that there is a traffic jam on your route home, and suggest a different route even before entering the car.
iPhone could ...
Location aware computing is HUGE... so i hope that apple includes GPS functionality. I'm eagerly awaiting official confirmation from apple, but so far they've been mum on GPS.