iPhone 3G GPS is unreliable; seems to use assisted-gps only
Solution 1:
The prelonged stern look didn't work??? Lol
I see that you tried restoring from a backup. Try restoring to stock software instead of your saved backup and see how it works. I've noticed that sometimes erratic behavior is caused by corrupted files within the actual backup image.
If that doesn't work, try taking it in for service...I really don't think that's necessary though.
Hope this helps!
Solution 2:
It sounds like the receiver chip is malfunctioning. If your 3G is still under warranty, return it to the store for service!
Something similar happened to my 3G: it would no longer find any Bluetooth devices, and no wifi networks even when I entered the network settings manually. I tried hard for weeks to make this work again, even restoring/upgrading etc. but in the end it turned out that the radio chip had died... After a long and phoneless week, I received a brand new replacement 3G from the store.