I am using MySQL at the moment, so I cannot really help you with the
distance calculations, but the documentation at
http://code.djangoproject.com/wiki/GeoDjangoDatabaseAPI#DistanceLookupssuggests
that your distance calculations should work at least if your SRS is
in meters/km etc.

I you mean default SRID as -1, I tend to think of it as a "don't know/don't"
care in the DB, making it store the data but without ability to interpret it
in any geographic way. I always store my geodata with a known SRS, be it
4326 (WGS84) or whatever the data came in. If you have a look at your data
source with any kind of GIS software, it should tell you what SRS it is in.
If you set it to -1, the DB will have no idea how to do the distance
calculations.

Ludwig

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