I have used my N95 with the Nokia Maps program and it does recalculate
- it's quite fun to deliberately keep going the wrong way and getting
the corrections.  It recalculates faster than my Garmin, and the girl
never gets angry if I take a wrong turn - not like my darling wife!
It all works just as well as my dedicated Garmin GPS Map60 with City
Navigator V7.  

It should only ask if you want to upgrade if you go to the
Enhancements option on the menu.  I have purchased one upgrade for
Nokia Maps - voice guidance for Sydney.  It gave me a 3 day free trial
first, and I thought it worked fine so bought the 3 year option.  It
was nice not having an American accent!  Oh, and because my N95 is
linked to my car bluetooth hands free, when the girl speaks out the
directions, they come through the car stereo system rather than the
N95 speakers, and are very easy to hear and understand.

Are you sure the N95 inbuilt GPS is working OK?  The antenna is under
the keyboard so if the phone slider is closed, the GPS doesn't work
too well.  You can check that it is OK by seeing 3 little green globes
bottom right of the screen.

When you are just having the GPS show where you are on the map, I
agree, but when you go into navigation mode it does go "top up" and
you also have the option of a 2D or 3D display - the 3D display looks
as it would if you were looking out through the windscreen.

I've not tried an external GPS with my N73 (my N95 works fine so I
don't need to) but the latest S/W upgrade on the N73 installed Nokia
Maps and that can use an external bluetooth GPS, so I see no reason
why you couldn't use your external GPS.  If the TomTom software works
on the N73, it should work on the N95 too - same O/S, Symbian S60 V3.

However, I suggest you see if you can get Nokia Maps working correctly
on your N95 if possible first, as the simplest solution.  You can
download the instruction manual from the Nokia web site - 32 pages of
it.  The only disadvantage I have noted to the Nokia Maps program is
that it needs Internet access while navigating, mainly to download
maps as needed.  When I'm home, I can use my wifi network, but
unfortunately it doesn't have the range to cover Sydney, so I have to
tell it to use Telstra Internet, so I incur some download charges -
don't know how much yet, haven't looked.  

I also have the Google Maps software installed, and it works much the
same as the Nokia Maps for display, haven't tried to navigate with it
though.  It is nice to be able to switch between the map and satellite
view though.

HTH

Peter