I did not have time for a new expedition during this most recent business trip, so I headed to the Red Rock Canyon area to test a $3 GPS app (MotionX GPS HD) on my iPad2. This model iPad has true GPS circuitry that accesses the global positioning system of satellites. It is not dependent on WiFi or 3G connectivity to determine its location. Not all tablets and smartphones have this. Many use other geo-location techniques such as cell tower triangulation, but these should not be called 'GPS'.
Here are the results of a hiking test and a driving test, followed by my bottom-line assessment.
I carried my iPad2 for a short hike, including trail and road segments. The road segment was to test the recorded walking track (red line) alignment with the map. The iPad and app performed remarkably well together; even showing on which side of the road I walked. (I used an app feature to preload via WiFi the area map in advance, since there was no connectivity on the trail.)

I previously identified a dirt road that might take me to a good sunset view of Las Vegas, then used the app to locate my particular turn-off among the many area dirt roads. It worked well to find the turn-off, but, had I carefully studied a terrain photo in advance, I would have seen the gate after the cattle guard. Note that my recorded driving track (blue line) was preserved so I could use the app to later super-impose the track on a terrain photo. You can see how I over shot the turn-off, came back up to the gate, then pulled back onto the road after realizing I was blocked.

I would not use the iPad in place of a back-country GPS unit, which is smaller and lighter, has replaceable batteries and longer battery life, and offers more detailed maps. (There are more expensive iPad GPS apps that advertise better maps.) A GPS app is a nice option if you are traveling with a GPS-equipped smartphone or tablet and want to stray a little off the beaten path.
Comments
iPad2 GPS
Matt interesting write up and it looks like the tracking was pretty good.
I tend to also gauge the variety of GPS systems based on how fast they can plot long routes. My very old Garmin Street Pilot III (which is my primary motorcycle unit) struggles on long distance routes... sometimes to the point I think it may have locked up. It eventually gets it, but it takes a long time. To my relief newer units are much faster. The other test I use is screen refresh - moving the screen from one position to another how quickly does it redraw?
I think your take on true dedicated backcountry units is spot on (no pun intended for the SPOT tracking device - or plug for that matter as I have one). I struggle to think about packing a iPad in my pack - not for weight, but against damage. Now that I think about it I could load the fire app and wouldn't have to gather wood or splash it with kerosene to get it started!