Quoting from the Gran Turismo FAQ:
What is the role of the host in an online race event?
Last Updated: Dec 24, 2007
In the online gameplay (Star type) of Gran Turismo 5
Prologue there is a host player.
The host has the following two roles:
(1) Manages the start and end of races.
(2) Performs the communication between all participant players for
internal data communications during gameplay.
Because of this, if the host exits out of a race during the race, the
race itself will be terminated. Also, please note that if the
connection environment of the host deteriorates, the cars on screen
may not drive properly.
For this reason, the software automatically evaluates the network
connection environments of the participant players, to select the
players with the most suitable network connection as the host.
The actual upstream bandwidth of the host is especially important
since they will be communicating with other players. Therefore the
software evaluates both the NAT type of the players, and the measured
connection speed during actual play as well.
Regarding evaluation of your network connection environment, please
refer to the following page.
I know this information covers the Prologue rather than GT5 itself, but I can't find any references to whether or not they changed the networking model between then and GT5. There is no other relevant FAQ entry for GT5, so I'm making the assumption that this information is still valid.
Based on this, it appears that the games are, indeed, hosted by one of the players and not on the PSN servers. If I'm reading this right, the game determines which player has the best connection as the time, so you shouldn't have to worry about it yourself. That said, having more people on a wired instead of wireless connection would help, since their bandwidth still matters for timely communication with other racers through the host.