Android's location service does a very neat trick whereby it looks around for Wifi signals, and then checks to see if any of the nearby access points have a known location. If so it can tell where you are very accurately. If you're in range of 5 or 6 access points then it can get a very good idea of exactly where you're standing.
This is, sadly, bugger all use if your Wifi is off, as mine tends to be whenever I'm out, so I can save battery power*. While it will happily activate the GPS** which takes at least 30 seconds to locate me with any accuracy, turning on my Wifi for 5 seconds to spot where I am is apparently beyond them.
So I have raised a defect. And if this would ever have been useful to you, then feel free to go along and let them know.
Not that I expect any changes, but I can always live in hope.
*I have an enlarged battery in my phone, which means I could theoretically leave the Wifi and still last more than a day, but I'd rather not drain it unless necessary.
**thus draining the battery far faster than Wifi does.
Original post on Dreamwidth - there are comments there.
- Android irks me