I think there's a hardware component required. Unless it's only in a beta OS, I have and Xs and I see a different wording for that setting. Mine omits "and powered off."
[1] https://beebom.com/how-find-lost-iphone-turned-off-erased/
[2] https://www.reddit.com/r/iOSBeta/comments/otcn02/iphone_rema...
All of the iPhone “off” features, like express transit cards and find my use dedicated low power hardware that seems to be capable of running the feature without an active CPU telling it what to do.