AFAIK anything made with AI that was in any way passable for human work was something that either took a decent amount of time for a skilled artist to fix before submitting (like that AI image that won a prize in digital art - I believe the submitter was a digital artist who spent a ton of time re-painting portions of the image to fix typical AI errors) or are a product of an absolutely insane amount of wasted time that was probably better used to actually learn how to paint from scratch (like that lady who just lost her bid to copyright her AI image comic, who claims it took her thousands of hours of entering prompts before she had enough images to put together a 30 page comic...). I feel like any AI novel would have the same issues, and since with novels the most time-consuming thing is outlining, editing and rewriting... IDK if getting that initial awful word vomit AI draft is really worth that much.
Also, I think what a lot of these AI prompters don't realize is, if the AI tech gets better... nobody is going to be paying them for their AI-generated novels or images. Why would I read a fantasy romance novel about a buxom blonde saving a muscley barbarian, when I would rather read a fantasy romance novel about a flat-chested redhead saving an otherworldy handsome wizard? I'll just go straight to the source and have the AI write me a story (and generate some art for it!) that fits my specific ideals in mind, not settle for another prompter's fantasy. In this world, the only creators who will still get paid are people who bring a kind of artistry and unique vision to the table - one that would make consumers set aside their custom-tailored junk-y AI content.
The thing is, without a revolution in the AI world, I don't think it will get better. The issue right now isn't a lack of resources, it's a lack of consciousness. You cannot generate something cohesive without awareness of what you're generating (or that you are generating at all). If AI gains that awareness, then, uh... Then we as a civilization have a couple bigger fish to fry. If anything, I think AI will become a tool that artists use to expedite their process, which would enable more artists to produce more content with smaller teams, which... IDK. I don't think it's that big of a deal (as long as we address the rampant art theft of the current models, of course).