I have an app that does a simple textbook navigator.geoLocation.watchPosition(...) that works great in iOS 5.x both in Safari and as a web app (using apple-mobile-web-app-ca
I can confirm I get the same problem when running my web app in fullscreen.
Interestingly, when Safari in Fullscreen asked permission to use my location, the website title was 'web' rather than the title of the website, as in previous versions of iOS.
Removing the "apple-mobile-web-app-capable" meta tag is fine, and it works, but only if you "Add to Homescreen" again. We have ~7000 daily users who have already added our icon to their homescreen. Getting them to do so again, then potentially again when a fix is implimented isn't great.