The new language around custom URLs is wrong. In link settings the checkbox reads: "Publish content broadly with a custom, non-private URL."

If I understand correctly (and I really think I do) how broadly the content is published is 100% controlled by the "People with the link / People in your company / Invited people only" setting in the prior screen.

Checking the box to create a custom URL does NOT publish the content broadly if a restricted setting is used, and does NOT make the URL "non-private".

This setting should be labeled with plain speech that doesn't imply anything beyond what it does: create a custom URL for this link.