You gotta love Google Maps and GPS on the iPhone. Except when it tells you where you are and that’s obviously not where you are. If it happens to you, you’re not alone.
The “GPS and Maps not working after 3.0 upgrade” thread on Apple’s own Discussions website is filled with comments from angry iPhone owners that the firmware update causes the bundled Google application to spit out current location results anywhere between a few hundred meters and four miles off course.
I’ve had the same problem a few times and fixed it by doing a reset or ensuring that WiFi was on. Then it worked perfectly.