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"The IP anonymization feature in Analytics sets the last octet of IPv4 user IP addresses and the last 80 bits of IPv6 addresses to zeros in memory shortly after being sent to Google Analytics. "

https://support.google.com/analytics/answer/2763052

I don't understand how this can be construed as tracking users.

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This is a totally different question, in this case what matters is that Google can be compelled to release the full IP address by US intelligence agencies.

So it's an easy fix for Google - change GA to only save those anonymized IPs

Not quite. Google still has access to those IPs when it receives the request from the browser and could be compelled to store them by US intelligence. Thus data are being transferred to a party that can not adequately protect them. So in this case, as I understand it, the solution would have to be something more elaborate, like proxying the analytics requests through the server to strip the original IP address. Which I presume Google isn't very eager to allow.

Lots of other tech companies, as I understand it, choose not to be "compelled" to store something they don't want to store. Apple being the prime example.

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