1. I don't speak authoritatively and
2. I don't have knowledge of the whole product - there's always a rogue team here and there doing stuff.
We've had that feature turned on at MSFT for some time now. It does not allow your manager to see that you're at Starbucks, at home, on the shitter or anything like that. There's a new toggle in the calendar settings called "Share location with my organization", and the settings are: "all details: building, desk, etc.", "general location: office or remote", "can't view any location information". What it does when turned on is just adding, at the top of your calendar, icons that tell you which of your colleagues are in office, and if they share and you click on someone's picture, what building they're in (when it works).
The whole "it will tell your manager what your wifi is" is just baseless extrapolation, and plainly false from what I can tell.