How do I retrieve columns inserted in subquery 1, and return them with columns inserted in subquery 2?
I figured it out:

You can only return fields affected by the insert (thus the error in subquery 2 return statement)

I needed to move the subquery into a CTE and then select the data I want to return

const insertUserSql = `
  with l as (
  insert into locations (
    data,
    placeid,
    user_count
  ) values (
    $1,
    $2,
    1
  )
  on conflict
  on constraint placeid
  do update set
    user_count = locations.user_count + 1
  returning
    placeid, data, uuid
), cu as (
  insert into users as u (
    password,
    email,
    first_name,
    last_name,
    location_uuid
  ) VALUES (
    crypt(
      $3,
      gen_salt('bf')
    ),
    $4,
    $5,
    $6,
    (select uuid from l)
  )
  RETURNING
    u.uuid,
    u.email,
    u.first_name,
    u.last_name,
    u.created,
    u.active,
    u.last_login,
    u.location_uuid
)
select
  l.data,
  l.placeid,
  cu.email,
  cu.uuid,
  cu.first_name,
  cu.last_name,
  cu.created,
  cu.active,
  cu.last_login,
  cu.location_uuid
  from l, cu
`;


However if there is a more efficient way to do this, let me know!