The GBA graphics hardware isn't very useful for 3D. You can do mode 7 type stuff effectively, but that forces your "ground" to be flat, and sprites for everything else, and even that is extremely fiddly. Since neither the GBA or the GP32 has 3D graphics support (or a floating point unit for that matter), the main issue is clock speed, and we all know the GP32 wins hand down on that front.
I think something like Tie Fighter would be ideal to run on the GP32 ... no texture mapping, few polygons and no complicated landscapes to mess around with. The only problem I can see is getting enough data onto the small screen ... you need scanners (which were excellent in Tie Fighter) and things in that sort of space sim so you have some idea where you are, as you don't really have any landmarks.
If I ever get the time to try any GBA development, I might have a go at making an engine for a Tie Fighter like game... But that's fairly unlikely, unfortunately.