The device does need to have permission to use your location. Perhaps you said no to the prompt one time or turned it off. Outside of the app, go to Settings > General > Location services. You should see a list of location based apps and this is where you can turn each one on and off. You also do need internet service for the maps to properly show.
Find this icon on your device, not in our app.
Look for Location Services
Control this for each location based app like the example below with another app of ours.
With wifi, sometimes your security prevents a proper location from being found. For example, my own iPod Touch usually thinks I'm in San Francisco or wherever the last place I used the device on a unsecure internet connection. My connection at home is secure and doesn't allow the device to properly find me. Or it may use the location of a cable/DSL hub and show you miles away.