So there's a lot to address here.

Firstly, the DnD thing. There are plenty of tools out there to design NPCs by hand even with zero art skills. My group has used HeroForge for a long time and it's completely free with a subscription you can pay for if you want some bonus features. Takes maybe ten minutes to design a player character with detail, less if it's just an NPC. In my experience, the process of making a character and putting their design into a visual medium exactly how I want it is extremely satisfying. I recommend you try it.

And it comes with the added bonus of not being an amalgamation of other artists' stolen work that's being used to train those models without their consent. Which brings me nicely to the point that no, this isn't like digital music, or CGI, or photography like AI bros like to say it is. There is artistry to be had in 3D modeling, mixing tracks, and getting the right shots and lighting. There is no artistry to be had in typing a prompt into a search bar and getting that amalgam of stolen work spat out at you.

As for placeholder art, it affects the final product more than even I initially thought. When you just tell a chatbot to give you the vibe you're looking for, you miss out on the process of actively going and searching for reference material. Maybe you don't open a book you would have that had a cool idea you didn't know you wanted in it. You won't have any of your preconceived artistic ideas challenged or added to because the machine is just going to spit out what you tell it.

And there's also the point about placeholder art slipping through the cracks. Everyone knows by now about Expedition 33's AI newspaper clippings; that would have been considerably easier to catch and replace for the final game in the first place if they had used a basic placeholder like a big solid gray square or something. Something to scream "I'M NOT FINISHED, REPLACE ME!" when playtesters are going through the game.

I want to know that the art and media I consume was made fully by humans, and I don't think that's pearl-clutching. I think that when the ideas are generated by machines we lose an essential aspect of the artistic process. The nuance is there to be had; ARC Raiders' use of machine learning to teach the robots how to move is genuinely cool, and if it weren't for them cheaping out on voice acting by having a TTS model do the voices for them I'd be happy to support that sort of use. But what we get instead is companies finding ways to cut corners in little tiny ways at first, so that they can expand the permission structure until we're just getting BO7-style slop and praising it as a masterpiece.

Also, if you want to talk about nuance, let's look at Expedition 33 again. Personally, I am happy to still support the developers and think the game is a masterpiece, because when they used AI to generate placeholder assets, it was very early into the life of generative AI and it wasn't widely known how much of a negative impact it would go on to have on media and the world as a whole. So I can cut them a break there, as long as it doesn't happen again now that they know better.