Another flaw is that humans won’t find other things to do. I don’t see the argument for that idea. If I had to bet, I’d say that if AI continues getting more powerful, then humans will transition to working on more ambitious things.
It sounds nice. But to have that, you need resources. Whoever controls the resources will get to decide whether you get them. If AI/machines are our entire economy, the people that control the machines control the resources. I have little faith in their benevolence. If they also control the political system?
You'll win your bet. A few humans will work on more ambitious things. It might not go so well for the rest of us.
We've come a long ways to that goal. The amount of work both economic and domestic that humans do has dropped dramatically.
Most likely? It's ridiculously expensive and you're poor.