The work of Dina Katabi shows that it is possible, although she used somewhat customized hardware and antenna:
https://people.csail.mit.edu/dina/
and that was the basis for the new 802.11bf standard. I believe there has been work since then demonstrating sensing use an ordinary router (maybe custom software but no special antenna). This product seems to be based on something similar:
https://gizmodo.com/hex-home-security-is-a-supercharged-moti...
and Amazon seems to have some aspirations in this area:
https://news.ycombinator.com/item?id=27795048
This is all basically radar and you can use microwaves at many frequencies to do all of these things and more (read heart rate, breathing rate, detect motion, get location) so it certainly is also possible with 5G radios. As you mentioned when the frequency gets higher microwaves have difficulty with distance (when it operates at the same frequency as the "water bands" where atmospheric water absorbs it). It also has difficulty with penetration, so if a wall stops them, then the wall will also prevent spying on you with them. So the lower frequencies like normal WiFi are actually better for spying on people because they will go through walls better. Since 5G also includes lower frequencies it should work as well as WiFi for these purposes.
It's somewhat of a mystery to me why the very high frequencies are part of 5G. I've heard that part of it was because those frequencies are currently unregulated since very little operates in that range. So it may just be a spectrum grab. 5G uses lower radio frequencies for voice just like 4G. The higher frequencies may be only for short range high speed data, such as video. So you could screen cast video to your TV with high resolution, but it probably would not reach from the other end of your house through the intervening walls. If they are actually intending to use 40GHz signals for normal phone operation it seems doomed to fail. It seems much more suited to high bandwidth data transfers when right next to a 5G antenna. So maybe you would only get short bursts of 5G throughput as you moved around, but that might be good enough to quickly download a video and be able to watch it at your leisure, but sometimes it would just not work at all, so the best use would be in a room where there is a 5G cell station.
Because of the small size of 5G cells it will be able to track phone locations with much greater accuracy. So location tracking data collected by the cellular companies will be much more precise, perhaps to the degree that it would be possible to tell what any one person is doing approximately from the phone in their pocket, especially if you could monitor heart rate and breathing at the same time. There would be some costs associated with doing this, maybe no modifications to the transmitters and receivers, but some software would need to be running and doing a fair amount of fast computation, which would require bigger and more costly computers in the cell stations. And it would mean more data flowing across the network to some central collection point. That cost might not be enough to be a deterrent though. So it seems like 5G could be intended to spy on everyone and everything. Whether it is currently being deployed that way would be very difficult to find out, it doesn't seem like something anyone involved would want the public to know. It's also possible it could be deployed as an upgrade to the system later on, which may make it easier to deploy with fewer people knowing about it. It's a good question, I'm not sure you'll find anyone able to supply any more of an answer than yes, it's possible, and maybe it will be part of 5G. It seems somewhat unlikely that the USA government would bless it, given that it would track all the senators, business owners, police, local politicians, etc. as well as the rest of the population and everyone would eventually find out since it seems like too big a thing to keep hidden, too many people would have to know about it to use it extensively. Might the USA or China deploy such a hidden feature in a 5G system sold to another country? There the more likely answer is yes, at least based on what we know of the USA's past history with cellular spying. And now that the world knows the USA has been doing that to its advantage (e.g., when negotiating trade agreements) all countries probably see no reason not to do the same themselves. It might be kept in reserve for critical spying though, since the volume of data would be harder to hide if the whole population was being tracked and exported outside the countries borders (although satellites might make that easier.)