Don't you have to connect with at least one of them?
Not necessarily. You need to have an Internet connection (in order to look-up the ID in the Skyhook database), which doesn't necessarily have to be through WiFi.
In the OP's case, though, yes. Didn't think of that, LOL. On a WiFi iPad, the only way to get an Internet connection is through a Wifi connection.
I believe the Location system does buffer up data on surrounding WiFi routers whenever it does get a connection.
Kind of a catch-22, though. You're going to have to set it for "ask to make connection" and be constantly dismissing dialogs as you drive down the street. Not so practical.
Maybe somebody with an iPod Touch can jump in here for yucks...