Yes and no; the location accuracy of a GPS receiver is strongly dependent on the accuracy of its timing source. The Dept of Weights & Measures generally certifies the accuracy of each physical device. In theory, the drivers could get their phones certified for measuring location and have one of those green stickers on the back that one of the other commenters mentioned.

In practice, any driver that tries will probably find it basically impossible to do, as I believe your analysis of the city's motive is correct.