

Every Bluetooth device has a unique identifier. Any phone that has seen that Bluetooth device in the past could have told google/apple/whoever “hey BTW this device is at those coordinates”.
Google already uses this with WiFi to help “bootstrap” GPS localization. It is much faster to get a GPS fix if you already know roughly where you are (a few seconds vs a couple minutes), so they use nearby WiFi/Bluetooth devices to determine that. Remember 10-15 years ago when getting a GPS fix took forever? GPS didn’t change, this did.
Apple went further and does this with Airtags now. Every Bluetooth device that ever went near an iPhone is in Apple’s database with GPS coordinates.
So unless you live alone in a mountain cabin that has never been visited by someone with a smartphone before and you didn’t disable the “enhanced localization” feature on your phone, yes your Bluetooth is at risk of giving up your location.
This is separate from A-GPS. Google seems to be using WiFi rather than Bluetooth, but the broader point remains the same. No one is stopping any vendor from crowdsourcing the location of every BT device… which is what Apple has done, for Airtags which don’t have the battery capacity to run a GPS chip.
Sure without GPS it wouldn’t be very effective to rely on only nearby devices to guess the current location. But an attacker only has to get lucky once to get your home address. So the only safe approach is to hide nearby devices/networks from unauthorized apps.