Maybe it's because I don't know the workflow to do game character design, but it looks like the only AI used in the character creation here was the initial character design? Like, before in a normal process you'd get a human artist to draw you a character on that "model" sheet, giving you a front/side/back view of the character, and then take that 2d drawing and hand it off to a 3d modeler who would turn it into a 3D mesh and start taking the 2d drawings and turn them into textures, and then rigging them for animation controls.

It seems like all of that 2d->3d conversion is still being done by a human in this workflow, and so the "only" part that's being done is the 2d drawings. Now, my drawing skills would put me in the lower half of an average 4th grade class, so it's more than I could do, but it still seems like we're quite a ways from going from a couple of prompts to get a 2d design sheet, then a mesh and textures that match that 2d design, and then a rigged mesh, and then motion data to attach to that rigged mesh to give some basic animations.

So, while this is super-cool, it still feels like we're a long way from saying "I want a plumber with a thick mustache wearing blue overalls, a red shirt, and red cap. And now I want him to be able to jump and squat coming down." and start putting that into my game asset library.