Having agps along with location on makes your gps programs work better. It stands for assisted gps. It just helps your gps startup faster and work better. Using it on a stock rom or custom rom shouldn't matter since most custom roms work just as good as stock ones. With agps and location on my custom rom on my tp2 it works great. Never had a problem. Only problem you have is if you don't have data signal coverage the maps wont update. Otherwise the gps along with agps helps you, it doesn't hurt you. That said, you should always have agps ON.
Google just announced the newest update on their google maps that is coming soon, the ability to use navigation without data. It is going to cache the maps so that if you drive in area with bad coverage you still have navigation available.
A custom rom that I used that had great gps assistance is energy. I still have it on my tp2 although it is now my backup phone since I upgraded to an evo
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