You're assuming that this policy continues for higher level courses. It does not. Use of LLMs is discussed, and in some cases even encouraged, in higher level courses like Software Engineering I.
I would argue that if they use an LLM at the stage of a lower-level fundamentals course, they'll suck even more at using an LLM for more interesting tasks. They also won't have the skills necessary to address problems when the LLM invariably doesn't do exactly what is desired.