Currently Being ModeratedApr 19, 2013 5:13 AM (in response to debprasad)
For location the iPod uses the location of nearby wifi routers that are in Apple's database. You do not have to be connected to the network/router to use that router's location. Thus, it appears that the iPod can't see a nearby router that is in Apple's database. Apple continuously updated their database based on info they obtain from iPhones. No one has been able to find a way to inform Apple of a router or correct is location.
You can confirm that by going to place with a know located router like Starbucks or McDonalds