Because users aren't actually all that aware of there being location data attached to their photos. If you told them that an app could stitch together a relatively accurate map of where they'd been in a day based on the photos they took, most users would be surprised.
I'll grant that users may not make the leap to thinking of building a full-on historical profile without being prompted in that direction...
I had literally no idea. None. Probably because I don't upload photos to social networking sites from my phone. So I'd be pretty shocked that Whatsapp could plot my movements despite not having access to location data...
I think you'll have to be pretty naive to assume that users inherently realise that "photos have location attached" automatically leads to "third party app can read location in these photos" and can lead to "build a profile of you based on your photo locations".
It's not that people can't put these things together, it's that they don't ever really think about it. When you download a photo editing app you're thinking about editing a photo, not about the metadata you might be leaking in doing so.
If i didn't give the app permission/information, it stands to reason that said app shouldn't be able to infer, or deduce it. If the app is able to do so, then they ought to be legally obligated to disclose this fact.
You and I both understand that that's metadata in the file, but non-tech users don't know that much -- they might simply have never though about it enough at all.
Users are stupid. iOS clearly asks you to allow the Camera app to access location, explaining it’s to tag photos.
Sure, we all know this. But this can't be taken for granted.
Do we expect regular users to appreciate that how the location data is stored as exif data within their photos rather than separately. I wouldn't expect this of most people.