What is the difference between the GPS and cellular?

The GPS only Apple Watch can do Everything the cellular can do as long as the iPhone is nearby, where nearby is say within the same 3-4 bedroom wood framed house.

The cellular can leave the iPhone at home when you go for a walk, run, bike ride, etc...

Your iPhone cellular carrier, if the support the Apple Watch, will charge a monthly fee to share your iPhone’s phone number with your Apple Watch. The carriers in the U.S. add $10 to your monthly iPhone bill.

Not all carriers support the Apple Watch, so check before you buy.

And you will need an iPhone 6s. SE, 7 or newer iPhone. The iPhone 6 or older will NOT work.

gps is a positioning system where satellites send out a "ping" with their location which gps recievers if they can get a ping from 3 or more satellites can calculate their location

if you wish to know more https://en.wikipedia.org/wiki/Global_Positioning_System

cellular is a land based wireless telecommunication and data system which mobile phones and mobile data devices use to transfer data to and from the internet and phone system

if you wish to know more https://en.wikipedia.org/wiki/GSM