People have some emergent machinery for symbolic reasoning in their brains. When they don't just react, they can continue working on an idea and improve it.
When it comes to humans, there is no fundamental difference between training a model and using it. People continue to learn all the time, which allows them to build models of new things and to update their existing models.
People can also interact with the outside world on their own initiative. When you combine this with the ability to learn and reason, it may transform the internal models from arbitrary mathematical constructs to increasingly accurate models of the outside world.
Nothing in this discussion is particularly new. It's just the Chinese Room Argument from decades ago, except that this time it's not a thought experiment. While a static Chinese Room can fool humans and be useful for various purposes, a general intelligence also needs other mechanisms.
I don't have strict definitions for any of the quoted terms because I don't think we really understand them yet.
It seems very possible that human generative content shares much in common with 'stochastic parroting'. But I'd hypothesize there's a filtering process, sometimes at the individual level, sometimes at a group or even civilization level that (so-far-over-long-enough-timescales) tends to cull some information that has low 'value' and propagates other data that has higher 'value'.
When an AI system can do the same, that's a big inflection point as you can give it energy and time and it will self-improve indefinitely.
It's pretty clear humanity has this capability. It's not clear whether AI does (or ever will). Or, perhaps it might already be there, and we just don't understand enough to know for sure.
This same phenomenon happens with evolution, which is obviously not ‘intelligent’.
Each human can basically be randomly exploring a problem space near things they have seen and understand, but they have a way of knowing when they hit on something new and interesting.
Even a dumb AI could randomly try a bunch of things… as long as it doesn’t try the same thing twice and had a lot of time, who knows what it might come up with. Validating the solution is usually easier than finding it.
We are able to understand right from wrong, we are able to answers with what is true or what we believe is true. We are able to lie or deny the truth. We are able to say we don't know because we think we don't know and not because we have been programmed not to answer, etc.
Overall I think people saying that, are just saying the difference is that we have a conscience and AI doesn't. Which in a lot of case does matter.
Where 'fancy' stands for "intelligent", there is all the difference.
Irrelevant since people do have the module to reflect and vet thoughts.