We did not remove this option, but with synchronized calendars the offered options can also depend on the provider of the calendar itself.
So with a standard CalDAV account you will see all 4 states (Free/Busy/Tentative/Out of Office) but for example Google Calendar only supports Free and Busy states, so trying to set a different one would not make sense because this status cannot be synchronized to the server.
Event on a CalDAV calendar:
Trying to save the same even on Gmail:
So has perhaps a different calendar been selected in the left pane than before?