In what way is it misleading? That’s exactly what I got from the headline and article.
However, it turns out that work generated by AI will be accepted, albeit under a human name.
> [T]he Office will not register works produced by a machine or mere mechanical process that operates randomly or automatically without any creative input or intervention from a human author.
This is a clash between the marketing BS that is contemporary "AI" and reality. "AI" is either sentient, or it's a human tool. The copyright office is requiring that people cut the BS and concede that just because you have particularly complicated tool, doesn't mean it's not just a tool.
It's like someone attempting to register a book copyright to a typewriter, the Copyright Office rolling their eyes, and responding: "Well, smart ass, if the typewriter wrote it, then it's ineligible."
A "machine generated work" is not considered copyrightable: "The Office will not register works produced by a machine or mere mechanical process that operates randomly or automatically without any creative input or intervention from a human author. The crucial question is “whether the ‘work’ is basically one of human authorship, with the computer [or other device] merely being an assisting instrument, or whether the traditional elements of authorship in the work (literary, artistic, or musical expression or elements of selection, arrangement, etc.) were actually conceived and executed not by man but by a machine."
Of course one could ask, if this is allowed, what's to stop humans from claiming authorship for the work of other humans? I'd argue this already exists, in the form of ghostwriting, as just one example. Not saying it's good or bad — it depends not the particulars of each case — just saying, as an elaboration on all this, that the system already allows for it.
AI software is just another tool. The human using it is still the creator of the work. Claiming otherwise is hype; we do not assign agency to software.
For example, you can't register a copyright for a naturally weathered rock in nature, and just say that it's a sculpture and I want to assign copyright to someone or some company.
Now, if you put the rock there, to let it be weathered, then you can copyright it. The distinction is that a human was involved in the creation, not that you "picked" a human.