I have this problem too. …And I have it again after fixing it in May.
SOLUTION: the person who is unable to share their location needs to delete and create a new contact for the person they are trying to share their location with. For me I couldn’t share my location with my wife, so I created a new contact, copied the info over one by one, then deleted the old contact and changed the name of the new one.
I suspect the corrupted contact propagated to my MacBook via iCloud because that one is funky now so I suspect that’s why it came back. So my next step is to clear out all her contacts on all my devices, and then create a new one on my phone and let that transfer over to my other devices over iCloud
My story is similar, my wife couldn’t see my location for months and at first it caused a bit of distrust in the relationship. Luckily I’m pretty tech savvy and we could tell it wasn’t working correctly and I found a solution. I hear you and I believe you. This is very serious bug. I filed a bug report in May about this and it’s come back. Not happy.