I had to go to great lengths to disable location history, and Google penalizes me for it by disabling search history in Maps as a result. I'm sure 99% of people don't go to great lengths to disable location history and so yes your entire history of GPS locations is basically saved to a Google database as far as I remember. (Note I'm obviously a user recalling details from years ago and not a Google employee/developer. My perception that Google collects all our GPS details forever by default is based on reality, whether or not that means you as an employee would actually be able to do anything with that data.)