The "test drive a win" where it would generate AI images of people as lottery winners was a real thing, and they have taken it down.

Only larger news outlet I see covering it is Fox news. They cite the "mynorthwest.com" as their main source, but they do say that they recieved a statement from the lottery confirming that it was shutdown for that reason:

Washington's Lottery confirmed to Fox News Digital that it shut down the site after being made aware of the purported image.

Obviously a lot of people don't like Fox news, but I don't think there's a political agenda where that statement shouldn't be trusted.