Facebook should just make a user's location required - not the ios permission to constantly track a user all over... but just a field on a user - city/state/country.
Or make it optional and just show that ad to users that have set their location field.
I don't think that's relevant here: the new prompts aren't about collecting gps data but correlating your identity across contexts. If you manually chose a city in Facebook, I think the ad in the other random app which used fb ad network would only be able to use it if the user said "yes" to the prompt.
Or make it optional and just show that ad to users that have set their location field.