Geostationary orbits would tie the satellites to being directly above the equator, which (a) would prevent the system from working beyond a certain latitude and (b) would cause an extremely bad distribution of "visible" satellites and angles between signals, precision would suffer.
Not to mention the transmitter power you would need if they were 25,000miles away in GSO rather than 90mi away in LEO
GPS satellites are actually in MEO, at 12,500 miles away.