Blastoidea GrapheneOS doesn't use Google services. There are no Google location services included in it. If you install sandboxed Google Play, those are regular sandboxed apps and therefore don't have access to location data or other standard permission by default. There's nothing to turn off unless you granted permissions explicitly.
Enabling location services in the OS only allows apps you have granted the Location permission to obtain location data. The OS location service is based on broadcasts from GNSS satellites and ground stations. It's a receive-only radio. It uses downloaded static databases to speed up location detection (PSDS) and also the more dynamic SUPL to fetch databases tied to carriers. Both of these are provided through GrapheneOS servers by default and PSDS databases are hosted directly on our servers.