"due to their inherent stochastic nature, there would still be a small likelihood of producing output that contains errors"This is the part that I find challenging when trying to help my friends build a correct intuition. Notably, the probabilistic behavior here is counter-intuitive: based on human experience, if you meet a random person, they may indeed tell you bullshit; but once you successfully fact-checked them a few times, you can start trusting they'll generally keep being trustworthy. It's not so with "AIs", and I find it challenging to give them a real-world example of a situation that would be a better analogy for "AI" problems.
In my family, what worked (due to their personal experiences), was an example of asking a tourist guide: that even if the guide doesn't know an answer, there's a high chance they'll invent something on the spot, and it'll be very plausible and convincing, and they'll never know. I'm not sure if that example would work for other listeners, though.
I also tried to ask them to imagine that they're asking each subsequent question not to the same person as before, but every time to a new random person taken from the street / a church / a queue in a shop / whatever crowded place. I thought this is a really cool and technically accurate example, but sadly it seemed to get blank stares from them. (Hm, now I think I could have tried asking why.)
Yet another example I tried, was to imagine a country where it's dishonorable, when asked about directions in a city, to say that you don't know how to get somewhere. (I remember we read and shared a laugh at such an anecdote in some book in the past.) Thus, again, you'll always get an answer, and it'll sound convincing, even if the answerer doesn't know. But again, this one didn't seem to work as good as the travel guide one; but for now I'm still keeping it to try with others in the future if needed.
PS. Ah, ok, yet another I tried was to ask them to think of the "game" of "russian roulette". You roll the barrel, you press the trigger, nothing happens. After a few lucky tries, you may get a dangerous, false feeling of safety. But then suddenly you will eventually get the full chamber.
I also tried to describe "AIs" (i.e. LLMs) as taking a shelf of books, passing them through a blender, then putting the shreds in some random order. The result may sound plausible, and even scientific (e.g. if you got medical books, or physics textbooks). The less you know the domain the books were about, the more convincing it may sound, and the harder it is to catch bullshit.
The last two pictures may have gotten some reception, but I'm not super sure, and there was still arguing especially around the books; and again, they were less of a hit than the tourist guide story.
I'm super curious if you have some analogies of your own that you're trying to use with friends and family? I'd love to steal some and see if they might work with my friends!