The idea that they are coming up with all this stuff from scratch is Public Relations bs. Like Arnold Schwarzenegger never taking steroids, only believable if you know nothing about body building.
If a person "trains" on other creatives' works, they can produce output at the rate of one person. This presents a natural ceiling for the potential impact on those creatives' works, both regarding the amount of competing works, and the number of creatives whose works are impacted (since one person can't "train" on the output of all creatives).
That's not the case with AI models. They can be infinitely replicated AND train on the output of all creatives. A comparable situation isn't one human learning from another human, it's millions of humans learning from every human. Only those humans don't even have to get paid, all their payment is funneled upwards.
It's not one artist vs. another artist, it's one artist against an army of infinitely replicable artists.
What is the basis that an LLM should be included as a "creative type"?
LLMs seem to match.
To go into details though, under copyright law there's a clause for "fair use" under a "transformative" criteria. This allows things like satire, reaction videos to exist. So long as you don't replicate 1-to-1 in product and purpose IMO it's qualifies as tasteful use.
If an LLM reads a free wikipedia article on Aladdin and adds a genie to it's story, what copyright law do you think has been broken?