I'm not quite sure if IO540 misses the point entirely.
As almost everybody here said, SA is being aware of all the factors in the environment around you, and in the plane, and have an awareness on how they're going to affect your flight.
Aviate, Navigate, Communicate is only the start in summing up what's involved.
Our brains unfortunately have limited processing power, get distracted easily, are not good at prioritizing under stress and so forth. And anytime we overload our brain, situational awareness suffers.
So if you can offload certain functions to something, or somebody else, the chances of brain overload become smaller and smaller, leaving you more time and capacity to deal with, for instance, interpreting radio calls of other aircraft. Or to think ahead about fuel status vs. alternates. Or do the 1000s of other little things that a flight requires.
Out of the Aviate, Navigate, Communicate mantra, navigation is the task that is arguably the most involved, and the task that is hardest to do on the mental autopilot. I mean, monitoring airspeed, bank angle and altitude, and listening to the radio until somebody calls out your callsign are things we can eventually do subconsciously, not? But looking for a specific landmark, timing a leg, fiddling with the knobs to tune a navaid and so forth is not something you can do subconsciously.
So by reducing the effort that navigation takes, your mental capacity to deal with other factors in the environment will increase. And that may greatly enhance your situational awareness. (Unless you apply that mental capacity to something else of course - making a phonecall, listening to music, conversing with passengers, taking pictures or even playing with the GPS.)
So, yes, in that respect a big and advanced GPS, with terrain alerts, weather radar and other bells and whistles can indeed greatly increase SA.