In general I consider a cell phone GPS to be better than a stand-alone for several reasons (in no particular order).
1: Updated maps: Theoretically maps will always be more up-to-date because they're based on Internet resources that can be consistently updated by the companies maintaining them. Theoretically if you've just received an update for your GPS (buying a brand-new GPS does *not* guarantee you have the latest maps), you may have as up-to-date or even more up-to-date maps than those online, but practically speaking the Internet-based maps will usually be more accurate.
2: GPS signal strength augmented by cell tower triangulation: GPS signal aquisition and accuracy are generally about as good as an average stand-alone GPS. If they are slower, it is not by a significant amount. Additionally, they can use cell tower location assistance to get rough positioning before GPS signal is available.
3: Photo-based street view: With Google-based navigation (basically, an Android phone) you have the option of street-view, so you can see exactly what your turn should look like, etc. This potentially solves questionable accuracy of maps in many cases, although of course the street view may also be out of date.
4: Voice commands: With the latest Android-based Google Navigation, you can actually speak destinations and searches to your phone. Talk about hands free!
5: Free live traffic: Most cell phone GPS apps have live traffic and many can use this info to help re-route you around trafficky areas. Many GPSs now also include this feature, sometimes free or sometimes with a service fee. But most of the less expensive models don't have it, from what I've seen.
6: Theft issues, portability, and "always available": With a cell phone that has GPS built-in, it's easy (and actually the norm) to take it with you when you leave the car. This means no theft issues. Whereas even if your stand-alone GPS detaches from its car mount, most often you just stick it in the glove box, so if someone does break into your car, they can still take it. With a cell phone you also have the GPS and related functions with you at all time, without the inconvenience of carrying a separate device. It's already designed for ultimate pocketability. You can use the GPS easily on foot (or a bike, or public transit), even to the point of "augmented reality" (see
Layar for a really cool example).
7: Updated Points of Interest: Relating to point 1 above, the points of interest will also always be up-to-date, and can have additional info that most GPSs wont, like links to Yelp reviews, etc. This can be especially helpful when you're in an unfamiliar area (as you often are when using GPS for navigation) and you want to find a good restaurant to go to, for example.
8: You generally have the option of changing the GPS software or using additional utilities to augment its capabilities. With Android, for example, there will be multiple GPS and navigation-related apps which you can choose from. Not only that but these apps will be updated over time. With a hardware GPS you will generally need to buy a new GPS unit to get the latest software.
9: More or less consistent update of new features over time. This is particularly true with Android, though whether you can upgrade to the latest OS version does depend on the age and manufacturer of your hardware, so choose wisely. But, assuming you have the right phone, you can go from Android 1.6 (starting OS for some of the older phones) all the way up to 2.1 and soon 2.2, without buying new hardware or paying a dime. Newer OS features include upgrades to voice control, better nav including bike routing, etc. Most new features are phone-centric, but GPS-related stuff also gets upgraded.
10: Sophisticated Internet-based Point of Interest and other searches: You can search for nearby points of interest of all types using name, type of destination, and a lot more. While some GPSs also include good PoI databases and search functionality, the actual searches are sometimes cumbersome. On recent Android phones these searches can also leverage voice recognition. For example, speak the name of a restaurant you want to get to and it will find the location, then you can ask for directions.
As you can see I'm pretty sold on the idea of a GPS-enabled phone. Do I have one yet? Sadly, no. Well, I do, but the GPS doesn't work on my current carrier (Credo). So why, you ask, am I such an advocate for it if I don't have one yet? Well, I've spent a lot of time researching it in preparation for my own GPS purchase, during which I heavily considered the stand-alone vs. cell phone option. I ultimately decided to buy a good Android-based phone and switch carriers, in large part due to the great GPS features I listed above. I'm basically just waiting for a 1Ghz Android phone with the right features to come out on Verizon and I'll snatch it up. I almost bought a Droid when it came out. I'm taking a big road trip (8 weeks) in August around the US and I expect it to be very useful.
Addressing the screen size issue, it really depends on what phone you have. The Droid, for example, has a 3.7" (wide) screen. The average stand-alone GPS is 3.5-4.5", though granted they're not widescreen so there's more actual screen space even for the 3.5" model. But the difference is not huge in many cases. You can of course get very nice, large-screen GPS units (though the price generally goes up quickly).
As for battery, a stand-alone GPS will definitely last longer without power. But for the most common GPS use case, in a car, you will generally have both the stand-alone and cell phone based system plugged in (why wouldn't you?) so the point is largely moot IMO.
Now I will grant that some of the points above are possible and true for certain GPS units, though often times at greater expense (or you make some other sacrifice, e.g. bulk). However most people have cell phones already, so if you have the opportunity to upgrade to one that supports good GPS features, it may be a better value overall than buying a stand-alone unit.
The big caveat for this is that you need a cell phone data plan to really make all this work well. Some carriers also charge additional for their proprietary GPS software/service, though this is on the decline with great free options like Google Navication.
If you don't already have a cell phone and/or don't want one (or don't want to pay for a data plan), then the stand-alone option makes more sense and is cheaper in the long run.
All this being said, I don't know how true any of this is for Australia. In the US a cell-phone based GPS really makes the most sense IMO, particularly Android-based. Elsewhere, you'd have to get personal experiences from people who live in those locations.
- Oshyan
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Definitely something to inquire about if you're ever in the position to lease a copier!