Been done--a group at some American university (I'm tempted to say San
Jose State, in California) flew a number of flights in, if memory
serves, a Seneca. I believe they used carrier-phase matching to improve
the positional resolution.
There have also been a few systems that used the Earth's electrostatic
(not electromagnetic) field; these have been small and light enough to
be used in RC gliders, although they tend to think "horizontal" is
"parallel to the surface," which can be problematic in rough terrain.
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