Spend the extra ~$100 and get the 3G version. No stuffing about trying to tether your iPhone and you won't have the battery draining from tethering. You don't have to buy a data plan but it's there if you need it. The money is well spent to get the GPS.
I'm not even sure if you can use you iPhone for GPS when tethering....?
I use the iPad at home on WIFI and on GPS when flying, but away at flying trips and holidays where I don't want to take the laptop, I top up my 3G monthly pre-paid plan. Works well for me.
PS FYI: teEthering is something that you used to do on your mother...