The coarse permissions and alarming text from the OS is a problem with both Android and iOS. Often, an app wants something fairly innocous, but has to ask for more, because it's grouped with other things in the same permission ask. Then, the OS message shifts all the blame with scary messages about what the app wants to do.
Two problems with this assumption per the article: 1) the app previously worked fine without the location information 2) the app no longer works at all without location information. The only legitimate use case for location I can think of would be to pull down cable/tv/radio channel/station listings. But this shouldn't be a requirement since the user could easily manually enter in the ones they want. My guess is that…
Maybe. Perhaps they fielded a lot of support requests related to getting Bluetooth and/or WiFi connectivity established before using the remote for the first time.
So it worked fine for this user, but didn't work well for less technical customers.