We've used GPS devices to compare cars and test rules for balance over the years. We're actually on the third generation of such devices with the AIM Solo2. Before that, NASA had Traqmate boxes, and before that we had these little pager shaped gizmos which we'd mount with these rubber boots that had magnets. I remember I had about twice as many of the boots as actual devices and I'd mount the empty boots on cars anyway lol.

I've not had a chance to play with the Solo2 but according to the AIM guys, the technology has matured such that they are far more accurate than before. Richard's statements still hold true, however. You cant use GPS to compare to dyno numbers since the GPS data is affected by ambient conditions, aero drag, rolling resistance, road inclination... That said, you certainly can use it to measure relative power across cars during the same session, spot a difference, and then go hunting for a reason on the car. That is exactly what happened in AI at Champs this year.