I'd recommend first updating to iOS 16.3.1 as it's always good to be running the latest software to see if a potential bug has been resolved. It also addresses an important security flaw that allows for a code execution exploit.
After this, if you haven't already, check your privacy settings. People, Items, and Devices all have their own location privacy settings. It's possible that they are configured differently.
If this doesn't work, try disabling Find My and then re-enabling. After, reboot your devices.
I haven't been able to replicate the issue on any of my devices. I'd recommend first reaching out to Apple Support to see if they're aware of any known issues/fixes. If not, you can always submit a bug report here.