GPS precision can be sub-meter, but that usually requires that more than three satellites be visible, that a known-location base transmitter be available to supplement the satellites, or both. Surveyors do that all the time. Whether it would work in a moving vehicle subject to the "view" becoming obstructed at any point in time is another question. I suspect that a workable GPS-based system would need some "inertial guidance" component like submarines have, leading to cost increase and still not preventing loss of precision, just letting it degrade "gracefully".

If, as seems likely, the current legislation passes, somebody (FRA probably) will have to force standardization of equipment and communication protocols quickly. To meet a 2012-2014 timetable for installation nationwide I'd say the standard would have to be set by 2010 at the latest so manufacturers can ramp up production and installation can get done. Regardless of cost. And I suspect the equipment both on-board and wayside would need to be easily and quickly "field-upgradable" because something will certainly not work right and need rapid fixing nationwide (Murphy's Law...), or at the tail end of the process somebody will come up with something that works better.