The article (and a lot of comments I have read so far) are only talking about casual navigation GPS, as in vehicle GPS units. The current crop of phone GPS solutions is inadequate for backpacking, camping, exploring or basically any outdoor activity that takes you very far away from a cell tower or a charging station.
Most non-dedicated GPS units do not have a compass (the new iPhone 3GS is a notable exception).
Most non-dedicated GPS units have pretty wretched sensitivity and accuracy compared to dedicated GPS units, especially in rough terrain or heavy tree cover. Anybody who does much geocaching will know this. It's no big deal while driving, but it can be very annoying to take the time to claw your way up a steep hillside only to realize you are 100 feet away from where you want to be, on the other side of a deep ravine. Even with driving, inaccuracy can be annoying, which is why TomTom includes another dedicated (more accurate) GPS in the vehicle mount for the new iPhone.
Most phones do not use standard AA or AAA batteries, making it more difficult and expensive to carry spares out away from electrical connections.
Some (most?) phone-based GPS solutions do not even install maps locally on the device, instead relying on cellular communications to download maps live, making them totally useless outside of cell coverage. AT&T's recently announced product for the iPhone is one example.
Rain (or anything else that might get the unit wet). There are many dedicated GPS units available that have various levels of water resistance.