While there’s no doubt that they have technically break the rules, just the fact that they afaik patched the few textures before this controversy (as far as I know, it’s possible that it was a reaction to this?), this simply sounds like a (very succesful) PR attempt by Indie Game Awards.

There’s no doubt that Clair Obscire isn’t a AI slop that cheapened on artists or art with GenAI, whis is the spirit of the rules IGA has. If you don’t take the rules literaly, they deserve the award. And that’s IMO important.

I’ve never heard about IGA before this, so it worked to draw attention to them.

I’m very OK with having rules in place to reject work where you replaced artists with AI. But this is not the case.