One thing I have realised is that location services work better on my Nexus One when the GPS is switched on!
Well I didn’t realise it was switched off.
My first indication that something was amiss was when using the Foursquare app which didn’t appear to be as accurate than using my iPhone in the same location. I just put it down to the iPhone been “better” and I was inside.
After this happened outside, I thought I better check the settings, and yes the GPS was turned off! Turning it back on and Foursquare was spot on to where I was.