I created a google takeout and in that zip file I found some files containing a ton of data about me. It has logged every single page I visited while using the google search engine and chrome browser. It even logged every single time I opened an app on my old android phone. It even has VOICE RECORDINGS of me and a log of every time I used google assistant. This is just some of the data and I’m very sure there is even more data they have.
It does that even if you turn it off. The setting just controls location access by third party apps.
Lineage os and F-droid is the better solution. It has the advantage of being bloat free as well