On the one hand, using works without consent or attribution is bad.
On the other hand... This is exactly how humans train to become artists: by studying and remixing the art of others.
I think the lawsuits have a case if they can prove copyrighted images were taken and used directly in the commercial product.
The moral arguments about AI and it's use and abuse are broad and difficult, because they rely on the intent of the end user rather than the developer of the tool to prove an argument has merit.
I personally don't like AI art, but I can't declare that it's the devil's tool and should be purged with fire. I only think it overall will be a net negative, like I feel with AutoTune. It cheapens the artform.
Everyone make their own artistic judgements, nobody's ideas are better. If people prefer this https://lexica.art/ (scroll down) then that's their right.
I imagine there are plenty of people that prefer Autotune voices for some reason too. Doesn't mean everyone needs to agree that it's good in itself or for artists.
And it's not a new phenomenon. The printing press made scribes nearly obsolete, cars led to a mass slaughter of horses (and all related professions), and so on wherever you look. Invention of photography nearly killed whole genres of art (and gave rise to impressionism, abstractionism etc.)
Unfortunately, we can only judge the outcome of these changes only decades (or even centuries) after they happen.