Some time ago I posted something about showing real-life location within Second Life. That was about being able to retrieve current GIS data and view it in 2L more than anything else, and all of the cool stuff was really outside of 2L (2L merely displayed the result of outside, server- and user-side work).
The user's cell phone reported its position to GIS, which rendered an image, and the latest map always appeared in 2L.
Conway has been blogging about his SLicer, which is a kind of messaging framework to handle communication between outside sources (i.e., real-world) and objects in 2L. Using that, we can send up user (or other entity) location reports, and have things in 2L act in response.
If you take real-world maps, render them in Second Life, do some calculations and listen for real-world reports, you can visualize a person's or other entity's real-world movements. Playing around Friday afternoon, I made the following movie. It's terrible quality, but forgive me, because it wasn't planned :)
Poor quality movie; bigger idea.
The video shows my view in 2L, watching Conway walk around Campus with my cell phone/GPS gig. In short: watch the lime green object move -- that's Mike walking around.