Ah, that makes sense. The setting is labeled
enable local logins via email and of course for it to work requires that local logins are enabled, which is not the case in our instance.
Email invites are not just invites to check a page but also (and mainly) to create a local account that skips trust level 0 (because you are being invited by a community member). If local login is disabled, then the only thing to share with external users is the URL of the topic, which can be shared anyway through the
Share button, which also accepts an email address to send the URL to.
No love lost.