Correct me if I'm wrong, but isn't a demonstration of navigation by pilotage and dead reckoning required on the private checkride?
I've always had a pretty good sense of direction, and I loved doing my private solo x-countries not only because I actually got to go somewhere instead of doing patterns all the time but I also got to test and confirm my basic navigational skills. My instructor at the time mounted his portable Garmin Pilot III on the right side yoke more for his peace of mind than mine. I told him I didn't need it and made a point to not even look at it during my x-countries. I always felt a greater sense of accomplishment being able to navigate the old-fashioned way rather than just by following a line on an lcd.
If worse comes to worse, couldn't you tell your student that the DE is not going to let him use the gps or that he is going to turn it off in the middle of the flight and that he better know where he is or he's going to fail the ride. That should get him in line.