It doesn't track you. Go to maps.google.com, look at a map of a big city, and press traffic. It just shows you traffic conditions. I think if you ask for driving directions, it calculates them WIth traffic estimations.. but.. iPhone has no real GPS in it, so it won't track you.
Basically, it REDRAWS the map with GREEN, YELLOW, or RED lines to indicate traffic conditions.
"[SIZE=-0]What do the colors represent on the traffic data?[/SIZE]
If available in your area, real-time traffic conditions will be displayed over the highway as color coded lines. Each color represents how fast the traffic is moving:
Green: more than 50 miles per hour
Yellow: 25 - 50 miles per hour
Red: less than 25 miles per hour
Gray: no data currently available
hmmmm... so I guess those random utility boxes with the solar panels to the side of the highway are reading and transmitting all this "real-time" data?