Yes you're correct that there's no way to give access to only selected local photos, but that permission also doesn't really make sense for the app. Its main purpose is to back up all of your photos automatically.
If you want to upload individual photos just do it directly from photos.google.com. It's a single click. There's no reason to install the app at all.
However they still don’t offer a way to upload specific photos, and if you attempt to share only selected photos in the ios settings app they detect that this isn’t all photos.
Here's a screenshot [1] showing how the permissions prompt originally blocked you from navigating to the other tabs, and some additional reports of the issue [2] [3]. What's worse is that very old versions of the app worked fine in view-only mode without these invasive permissions demands, but then Google decided to update the app to be completely useless unless you surrendered all your photos.
I'm surprised Apple allowed the app on their store for over a year, with what appeared to be a clear violation of their policies.
[1] https://imgur.com/a/l2sErQQ
[2] https://support.google.com/photos/thread/1939628/use-ios-goo...
[3] https://old.reddit.com/r/googlephotos/comments/rhoyb1/google...
When you open it, it defaults to the "Photos" tab which has a message (not a dialog) asking for all photos access. But if you switch to any other tab (like Search or Library) you've got access to all of your photos in the cloud.
On the one hand you wouldn't realize that if you never tried tapping another tab. But on the other hand, the main "Photos" tab is designed to access all of your local photos and show whether or not they're backed up. Most (although not all) people are probably using Google Photos for this (to save local photos to the cloud), so it at least makes some sense for it to be the main tab with a prominent request.