iPhoneatlas reports that there is a function to "call home" hidden somewhere in core location. Obviously, this is used to revoke "bad" applications distributed trough App Store.
So, might this be the reason for GPS to work only when connected to a cellular network? I don't think so, because you just have to have reception of a cellular network for the GPS to work but there is no need to have working connection to the internet.
By the way, I've got no response yet to my inquiry to Infineon and I somehow doubt there will be one at all... With further information on the chipset, I could determine whether you need cellular network in order to have working GPS and if this could be changed to standalone or not.