This system is required to utilize mobile phone techonology as a medium of communication.
The GPS/GPRS hardware card needed to do the communications part on microcontroller project is available nowadays as module at quite reasonable prices. Products start here in 60-100 Euros range.
How do I choose peripheral devices such as A/D, D/A and memory?
If your application is not very complex (not very much software, nor very many analogue I/O signals), then try choosing a microcontroller that has the needed memory and the interfaces built into chip. The are many microcontrollers with quite useable amount of EEPROM and RAM in them to run the amplication, plus built-in A/D converters and even D/A outputs (quite oftem implemented using PWM techniques, you just need to set output pin to PWM mode and add suitable low pass filter to get analogue signal you want out).
If you need more memory that any single chip will give, check what kind of single board computer modules are available. Using a ready made processor module with needed memory and interfaces built in will get your application runnign quicly (will save you from designing and debugging your own microcontroller circuit board).
How do I connect microcontroller with mobilephone?
Typically this is done with older cellular phones and embedded GSM/GPRS cards thrpugh serial port (similar to RS-232 but usually at TTL signal levels). Some newer phones and cards use USB interface.