What was the situation of homosexuals in the early Soviet Union?

This looks like a great area for more research. The question makes the important distinction between what is found (or in this case, not found) in law, and what actually happens in practice. This is especially the case when we are talking about Soviet law. Below I'll summarize what little I could determine from these three sources:

1. Sex and Russian Society edited by Igor Kon and James Riordan
2. Sexual Revolution in Bolshevik Russia by Gregory Carleton
3. Homosexual Desire in Revolutionary Russia by Dan Healey

In (1) this is discussed primarily on p90-91. The overall emphasis seems to be that during this early period, was that the Bolsheviks did not put much active emphasis on the issue. It notes that Anarchists and Cadets "officially proposed" revoking legislation against h*m*sexuals while the Bolsheviks took no position. However, its absence from the Russian Criminal Code in 1922 and 1926 effectively decriminalized it, as you pointed out.

In terms of practice (1) merely mentions that a group of h*m*sexuals that referred to themselves as the "blues" included (according to one source) prominent figures such as Foreign Affairs Commissar Georgi Chicherin (also mentioned in the short article in @Emanuele's answer and probably the source of the official in government you quoted), poets like Mikhail Kuzmin, Nikolai Klyuev, Sofie Parnak, and director Sergei Eisenstein. While not illegal, towards the key early 1930s turning point it was increasingly pathologized, rather than seen as a crime.

In (2), Carleton points to the surprising defense of freedom in sexuality in a 1927 work called Sexual Crimes arguing that it did not violate anyone's rights (p60). Later, however, it emphasizes the diversity of opinions in the writings of early Soviets with some seeing as "outside the proletarian norm" (p78) or "were no longer authentic members of the proletariat" (p142) while others, such as Israel Gelman, who studied the sexual behavior of postrevolutionary youth, called it as a "sickness" and "perverse" but not to be condemned or persecuted.

(3) by Healey, is perhaps the most cited book discussing this issue during the period you are interested it. As also true with (1) I had limited access to it through Google Books. Chapter 4 and 5 are of interest to your question. Healy argues as others have, that "the silence in the penal code...offered new opportunities for medicine in an area formerly dominated by police approaches" (p148) There is a lot more here but I am not able to get access to it. A review of the book in The Journal of Sex Research Vol. 39, No. 3, Aug., 2002 by Stephen O. Murray (limited access: http://www.jstor.org/stable/3813622), p247 which argues that Healey goes beyond what his sources can show him. He questions Healey's effort to locate "clear intention" to remove sodomy from the criminal code or an "explicit decision". Murray points out that 1922-1933 there was "no single official position on h*m*sexuality" in the "Slavic heartlands" but "treated with suspicion as being 'unproletarian'...decadent bourgeois behavior," and he also quotes German sex-reformer Magnus Hirschfeld visiting in 1926 as not seeing "any open organized group of h*m*sexuals in the new Russia and that Soviet journalism and literature were silent about the question" - which he contrasts with liberal late Czarist Russia.

These three works give some hints, but I didn't find much mention about the lived experiences and practical impact of the [lack of] policy on h*m*sexuals on the ground. Some of this may be covered in Healey sections I was not able to view. Beyond laws, of course, the discriminations faced on a daily level or the need felt by individuals to conceal their sexuality is another matter that may be difficult to find through available primary sources. There may be extensive literature in Russian on this, and hopefully someone can contribute with more on this.