I can't find the feature at the described location either, but apparently if you go to contacts there is a "find people nearby" button. If I click it it asks me to share the location, which I have disabled. So I guess I'm safe?
It's mentioned in this changelog item: https://github.com/Telegram-FOSS-Team/Telegram-FOSS/blob/847...
It usually takes some time for Telegram to be published on F-Droid, so the newest version on F-Droid is 7.2.1 while the newest one on Android is 7.3.1. It might contain such a menu on the newer version like in that screenshot. Or the button only appears at that place if you have enabled location sharing.