That's inaccurate. Location services doesn't just use GPS - it depends on data from Google when determining location via wifi, which is more battery efficient. So there are definitely Google-specific elements in there.
Proximity Alerts are part of the released AOSP core source. The replacement is not. They can interact with the WIFI location provider, but don't have to, and are still functional even if it's disabled (which is easy to do from the stock UI). So, this is a function which has been moved from core AOSP to Play Services.