where is the tooltip gone for misspelled words in ios 10
The feature you're talking about is called spell check, and is different to the automatic spelling correction that occurs when you type.

It still exists in iOS 10. 

To make sure that it is enabled:

Settings > General > Keyboard > Slide "Check Spelling to on"

If it is already enabled, I would recommend disabling it, restarting, re-enabling it and then restarting again to be sure. 

Lastly, make sure you are using the default Apple keyboard by going 

Settings > General > Keyboard  > Keyboards > Ensure "English UK" or "S" is checked.