although instead of running the "client" on the iphone (with the "server" in the simulator), it would be cool if you could just use your web browser with some sort of mashup to Google Maps/Earth to drag your location around and have it send the location to the simulator.
You can call the CL delegates with any data you want. Just set up a timer to read from a CSV lat/long table if you like, and you can make the simulator appear to be anywhere on the planet.