My understanding is that if a student is heading for a licence test, PPL, CPL he/she will need to demonstrate an understanding of instruments at there desposal, i.e navigation instruments installed in the aircraft not hand held GPS, if GPS is one of those instruments so be it, to assist in there navigation.
Its up to the instructor or examiner to make sure that the student is not using only one form of instrumentation, i.e GPS, ADF, VOR or just plain old DR for navigation but a complement of techniques to assist them.
So there is nothing wrong with GPS
unless the student becomes to depandant on it then you just turn it off so they start using other techniques.
chucky