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Fine location is needed in order to use Bluetooth on android mobile phones.
This is not related to Ledger at all. There are lots of explanations about that on the web, you can find them with google.
Basically bluetooth will cause the android mobile device to be located by fixed BT stations or other BT devices that are geolocated, which result in fine location known for the device.
If you disable fine location, the device automatically disable bluetooth to prevent conflict i.e. having fine location known (via BT) while fine location is disabled.
So nothing suspicious there, it’s the way bluetooth and fine location works on android mobiles (before version 12).
[https://support.tracetogether.gov.sg/hc/en-sg/articles/360043224854-Why-does-TraceTogether-need-the-Nearby-Devices-permission-on-Android-12-and-above-but-need-the-Location-permission-on-older-Android-OSes-#:~:text=Before%20the%20launch%20of%20Android,and%20%E2%80%9Clocate%E2%80%9D%20the%20accessory](https://support.tracetogether.gov.sg/hc/en-sg/articles/360043224854-Why-does-TraceTogether-need-the-Nearby-Devices-permission-on-Android-12-and-above-but-need-the-Location-permission-on-older-Android-OSes-#:~:text=Before%20the%20launch%20of%20Android,and%20%E2%80%9Clocate%E2%80%9D%20the%20accessory).