Previously I'd written about the challenges of having the geo-tagged photos taken with your Android uploaded to Picasa with the geo EXIF data. Basically they weren't.
But how do you know if at the time you taken the photo that the GPS has got you a location? Even if you select the option, there is nothing in the display to indicate it.
What you can do as a workaround is to use another GPS application, typically I use cardiotrainer or Google's own MyTracks. When they go into the background they keep the GPS up. So you can switch to the camera and be sure that the location will go into the EXIF data.
But a visual indication would be better.