Hmm, very odd! For that 'Require Passcode' page, there are more options other than 'Immediately' if you turn off Face ID altogether or turn off using Face ID for unlock. I fiddled around with this and haven't had any luck in getting Immediately unchecked, while also using Face ID.
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The closest thing I can get to your old/wanted behavior is to turn off using Face ID for unlock, go back to the previous page (or leave Settings), then go back into 'Face ID & Passcode' to select a longer time the list above. You won't be able to use Face ID to unlock your phone, but your phone can stay unlocked for up to 4 hours until you need to put your passcode in again.