This is an absurd problem. I have it, too. And it's more than just an annoyance -- if the only effect of it was that some old devices were listed in Settings, I wouldn't mind -- but it breaks two-factor authentication (2FA).
I have 2FA turned on for my account. Find My iPhone properly sees my iPad Air and my iPhone 6 (and my MBP), and nothing else. Yet the list of devices iCloud offers for sending verification codes under 2FA is my iPhone 5 (now sold). and my prior iPad (also long gone)! None of my current devices are offered. Fortunately, it also offers a text to my mobile number as an option -- God forbid I ever change that -- so I can still verify when needed.
So this is a huge problem. I am one lost phone away from being completely locked out of my iCloud account, because Apple is incapable of following what devices I actually still own and offers no way for me to update the list. This despite the fact that all my current devices are right there, properly inventoried in Find My iPhone. Absurd.