Yes, at best the AI works would still be infringing derivative works. If a human made that art and tried to make money off it, courts would almost assuredly say it lacked "sufficient tranformative creative effort" to allow it to be copyrighted itself or protect it from being considered an infringement. There's a big difference beween "inspired by" and "trying to copy".

Further, if all these works were being used for non-commercial purposes, like, just to print and hang up in their homes or something, it would still suck for artists (because they would lose the individual end-sale market) but it wouldn't be nearly as harmful. The big problem is that people and corporations are currently trying to use AI art to sidestep paying creatives for their work and then using that AI generation for commercial purposes or to loophole the art out of things like Patreon. It's a deliberate attempt to deprive hardworking creatives of the money they are due for their work.