I bet if you looked up waifu's definition it'd have a vaguer meaning. In local LLM context, there's a sizable community for "virtual girlfriend AI", once you start hearing things like "SillyTavern" you're over in the community. Think applications designed around local LLMs and the use case of having pre-canned prompts to "boot up" a girlfriend persona.

For what it's worth, I'm being glib, so it may seem I'm linking it to erotica for giggles. c.f. graphics used on official GitHub, https://github.com/SillyTavern/SillyTavern, and language at https://sillytavernai.com/ like [1] and [2]

[1] "We recommend using our sister site: https://aicharactercards.com. It is a moderated character card repo. All cards go through a moderation process to make sure there are no overly inappropriate, illegal or scam like cards. NSFW cards are allowed so long as all characters are above the age of majority."

[2] Easy to use prompt fields such as main prompts, NSFW prompts and Jailbreak prompts that let you steer the chat in any way you desire

One of the early uses for NN-style AI image content aware fill was a tool called "waifu2x", for upscaling anime from VHS.