Are they just ignoring the setting?
From the FCC report:
> Between May 2007 and May 2010, as part of its Street View project, Google Inc. (Google or Company) collected data from Wi-Fi networks throughout the United States and around the world. The purpose of Google's Wi-Fi data collection initiative was to capture information about Wi-Fi networks that the Company could use to help establish users' locations and provide location-based services.
Have I misunderstood?
Therefore this kind of location lookup does not require permission.
But yeah, that's not what the location API means.
If I remember well, about 1% of the results were not up to date after 7 days. And the free database was at least 2-3 weeks old.