I find AI generated "art" wildly interesting. Art is generally a conscious act of human expression typically visual or musical in most common forms.
The machine (not conscious and non-human) generated (created?) the image (artwork?) from prompts input by the user (artist, producer?). At this point it feels like it's just a commodity.
But then it was entered into an art competition. Now the user has become an artist and made a very interesting statement with the image's entry. And the fact that it won 1st place, validates the artist, the work, and reinforces the statement.
So is the mere conception of the idea now art? Or is it not the human but the AI that is the artist. My gut reaction is that this isn't art. I actually feel the underlying artistic statement is similar to what Dadaism was getting at. It's non-art and absurd. It's virtually meaningless. But its entry into an art show elevates the status from nothing to something, however meaningless it is.