Okay, it looks like a data plan is required. If I recall correctly, even without a data plan your phone will utilize the GPS equipment (if it has it) for 911 calls, but only for that, I guess. You can still track others on their mobile devices from your computer.
Google Mobile | Latitude for your phone
I don't give my data plan much thought I signed up for the Sprint SERO plan about 26 months ago. It was not very widely publicized (except on some forums) but folks could get a plan with 500 minutes and unlimited data for $30/month or 1250 minutes and unlimited data for $50/month. I went for the 1250 minute plan since I knew I'd go over 500 minutes during some months of the year (i.e., chestnut harvest, etc.). Several people got the 500 minute plan primarily for the data. While the phones are not supposed to be tethered to a notebook under this plan, it is widely discussed as a common practice. Unfortunately, this plan is not open to the general public like it was for almost two years.
I think this service must have some bugs as my phone will update my position very quickly but when I view Latitude on my computer, it doesn't update for at least several hours in some cases. Maybe it will get taken care of when a friend updates the ROM on my phone for me (I'm afraid I'd botch it doing it myself).
Harvey