That's not brace expansion, that's a standard parameter expansion operator (dates back to the Bourne shell in the 70s).
Expands to the value of
$1 (the first positional parameter) if it is set (if
$# is strictly greater than 0) even to the empty string, or to the content of the
$PWD variable otherwise.
info zsh 'Parameter Expansion'
typeset is not Bourne nor POSIX, but it's not
zsh-specific either. It comes from the Korn shell (from the early 80s) and is used to limit the scope of a variable to the current function. It's also found in
info zsh typeset