3G functionality is just mobile data. If you are in range of an open wifi connection you can use that no problem. GPS is a separate system entirely for the location part, however with the preloaded google map it will use GPS to find your location but needs data (wifi or 3G) to load the map. If you are paying for the 3G you also have access to ATT wifi hotspots like McDonalds and Starbucks.
I'd recommend to get the 3G version. Only $130 extra and that way, in the case that you might want to use mobile data away from wifi sometime then you can sign up for that month and then cancel for the following month (cause no contract required).
I just had a long roadtrip/vacation to the western states and having 3G data was helpful a little for example when travelling down the road and wanting to search some info/location.