The biggest change in this new update is of course the way that your iPhone handles the location data archive, making it much smaller and encrypting it for safety. It also no longer backs up the cache to your computer via iTunes.
It’s interesting to note that not only does the iPhone stop recording location information when Location Services is turned off, it also deletes the cache entirely. This is an additional enhancement to the iPhone’s location data policy that was not revealed in Apple’s location Q&A.
The new iOS version also adresses a few battery-life related issues and iPod bug fixes.