It's that the space of intellectual property LAW does not handle the robust capabilities of LLMs. Legislators NEED to pass laws to reflect the new realities or else all prior case law relies on human analogies which fail in the obvious ways you alluded to.
If there was no law governing the use of death stars and mass murder, and the only legal analogy is to environmental damage, then the only crime the legal system can ascribe is mass environmental damage.