I tried it too. After the first time that the connection doesn't start, at the second time it conects the gprs/edge signal - and my laptop is able to connect to the mobilehotspot adhoc network.
But no navigation
I was very disappointed with mobile hot spot, I tried it on 1.2 and 1.3 and tried stuff like making sure I was not connected via gprs before connecting. the end result is the best I was ever able to achieve was pinging the n900 but I could never get to the internet.