I see a lot of straw men set up here. I don't remember anyone saying that LLMs have human intelligence. The question is, do they need to?
And we all know intelligence can't create itself from simple components -- oh, wait, that happens in the womb on a pretty regular basis. Intelligence showed up on this planet as a result of the interaction of basic forces, and that was without an army of researchers pushing it along.
To get back on topic though, the real question is whether or not people will make more money with AI assisted games/game creation. You can argue about the morality of replacing jobs with AI, but it's all going to come down to the bucks. I suspect that those who embrace "AI" will out compete those who don't, despite their lofty ideals. I don't know any gamers (who aren't also developers) who care much about how the game was created.