At the moment, I believe it is only the Android phones which sport GPS. (Although Nokia feature phones already have Ovimaps). Bringing maps to the table means WP7 will be on par with Android on such a basic feature.

Does this mean MS has basically bought themselves a mapping company for a couple billion dollars? On top of it, they've secured a solid brand with a good distribution channel and pre-existing relationship with carriers. It sounds like a good deal for MS to me.

As for who is going to be dictating who, I believe Nokia is mistaken. MS will drive the relationship because MS owns the platform, not Nokia. This is something even HP and Samsung realizes. I'm surprised Nokia has palmed off Symbian to Accenture so quickly. Perhaps this is to shake out the management tree a little bit.