I'll go out on a leg and ask - why not brute force and use signal jammer. Or in SCIF, jam all incoming signals, except for the ones they want to whitelist. If there is wifi, whitelist devices that can be connected to it.
The DoD, Intelligence Community, and US government as a whole is subject to the same rules as everyone else, and would get into huge trouble from the FCC if it was found out that they did that.
On an side note, like other federal laws, the DoD is subject to endangered species laws, and actually take a lot of care to make sure they do not endanger them, which is made fun of here:
A jammer doesn't fix the fact that these devices could still record whatever when inside the facility and just transmit the acquired data later once the wearer goes outside.
The risk is not limited to location data. Leaking any audio or video could also be problematic. I also wonder how much location data could be inferred with accelerometers.
I'm going to assume that it's because it really isn't all that important. The military is looking to avoid headlines like "Strava heat maps reveal military base layouts" but they don't really care if the base layouts are revealed.
Back when this controversy was first stirred up it seemed unlikely that anything sensitive was really exposed. Other comments in this thread indicate that the military is perfectly capable of restricting the use of personal electronic devices when they care about it. This seems like a case of the public demanding "something must be done" and the military responding with "okay, we did something".
So you'd propose jamming the GPS satellite broadcast signals? That would pretty much just break GPS for everything nearby. Or do you mean just outbound communication from wrist devices? How are you going to prevent people from just going home with their Apple/Garmin watches and connecting/uploading from there (which is, presumably, what they already do)?
For a military operational area? Quite frankly I'm surprised that GPS signals aren't jammed today. At the very least, with the advent of cheap drones, and the dangerous payloads they can carry, I've got to believe that it will be forthcoming soon, regardless of the loss of intel that can be occurring.
The military created GPS. It wouldn't be very productive to jam their own signals on their own bases.
Military bases already have rules covering use of electronics like laptops, cameras, and phones, so adding smart watches to that list isn't very surprising.