My read of that caveat from Google is that the code that was removed was third party code that Pebble had a proprietary license to use, thus it was not Google's to release.
In the given context "Proprietary source code" seems to potentially primarily mean third-party proprietary source code which Google doesn't have the rights to re-license.
> Proprietary source code has been removed from this repository and it will not compile as-is.
So much for “open source”. Must have been some nasty telemetry in this OS.