Sorry,
Not to nitpick, but I had to come back and clarify a point on "Assisted GPS".
First, as pointed out, it is only available on the 3G model, the Wi-Fi only edition doesn't have this feature. The cool thing is that while the 3G model does cost more, you don't need to pay for a data plan if you don't intend to use 3G. However if you are going to use 3G for data service, at least you can now take advantage of a pay as you go type plan instead of a fixed contract.
That said, Assisted GPS is fully functional GPS. As there a numerous GPS sats, devices need to be able to locate quickly and calculate your locatation. This can be a complex matter, and the older GPS devices used to take a long time in people patience to sync up the first time. Some products use a little trickery to improve performance. TomTom, of which I own a brand new model from this Christmas season downloads a "QuickGPSFix" file every time you sync it to the computer to help improve this time. Each "QuickGPSfix" update is valid for 7 days.
Instead of downloading a QuickGPSfix application every 7 days like a Tom-Tom, the existing iPhone 3G and 3GS will use cellular tower triangulation, wi-fi or 3G internet data lookup to replace the need for a "QuickGPSfix". Once the sat positioning data is located, the iPhone can now access the GPS sats in a much more efficient lower power mode and still be quick and accurate.
Here are some links to help, since Apple doesn't do a good job explaining this themselves:
http://en.wikipedia.org/wiki/Assisted_GPS
http://www.gpsworld.com/gps/assisted-gps-a...re-approach-734
http://www.gpsworld.com/gps/assisted-gps-961
So a large part of the Assisted portion is to help ensure quick and accurate GPS sat location (startup) without a large expenditure of power.
As for if the GPS will work without Cellular triangulation? I used my iPhone and it's GPS internationally (Nairobi, Kenya and also Managua, Nicaragua) and I've run into a problem, there are cellular networks and data networks available I've gone. How can I test if GPS doesn't work without either infrastructure not being present?
The issue is more of an issue with the "free" GPS enabled applications on the phone (Google Maps and Google Earth) that do not store the map database on the device. This tethers the GPS functionality to access to the "internet". TomTom and others do sell GPS software for the iPhone that have full map databases and remove the need for the internet tether, but the price is so close to the stand alone devices from that vendor when on sale that it doesn't make much sense. But in locales where the iPad is most likely to be used, the ubiquitous access to the internet via Wi-Fi access points or 3G data service is more than likely to be available.
So if GPS is a need, just purchase a 3G model of the iPad and forget how it works for GPS, it just does and meets the deffinition of "real GPS".