ALL currently popular AI image and text generators are based on stolen work. Until that is no longer the case, and there's no indication this will change until (inevitable) lawsuits and heavy regulation, all so-called 'AI-art' should be banned on creative platforms. It's not even creative work, it's no work at all. When you type a prompt into Stable Diffusion, Midjourney or Chat GPT you're not creating anything, you're doing a pattern search. The result is not yours any more than if you had done a Google image search. It's a derivative composite of other people's work used without permission and you definitely cannot use it for commercial work.
Now, it's a little complicated because there are smaller scale AI-based or AI-adjacent tools (depending on definitions) that have long been used in various small ways in game development to assist or augment creative work rather than replace it. Things like procedural generation, content-aware fill in Photoshop, photogrammetry, etc... but the key difference is those were built ethically on licensed material or one's own work. Those are fine, mass automated plagiarism is not.
For those reaching for the tired "fair use" argument, AI scraping 100% does NOT fall under fair use because any commercial use of this tech fails point 4 of the rules of fair use which says that you cannot impact the value and market of the original author with derivative works. Not to mention, fair use is only an American legal concept and this defense certainly would not fly anywhere else in the world even if the US were lax enough to allow it (which they won't).