Oh wow. Interesting stuff. Some very good points. I agree with you that a similar game wouldn't fare too well, but what about a game that has better gameplay and a solid amount of non-gps content? Maybe some AR usage too?
A game I have played for a while is Zombies Run:
This game encourages exercise in the real word to collect money and resources to build up your base. SixToStart the guys who develop it have a number of other exercise games that encourage you to get out and about. I'm not entirely sure if all there games actually use the GPS or are just using your devices as a pedometer but, they are still different in that you are encouraged to get off your arse to go and play them.