It's an Android service. But unlike on regular Android where Google play services have hard-coded special permissions, on Graphene it is an ordinary android service with all the same strict rules applying to it, as to any other service you could write.

So an application of course can use other android services if it declared that, that's why it can see whether it's running or not. But you are in full control whether google play services is installed, and what it can use.

Of course this may break certain apps (Google maps location sharing will probably not work with the location permission denied for play services), which may or may not degrade gracefully.

I denied the contacts permission to the Play Services. It just shows a notification when it tries to access them, which is actually not common at all.