We’re not talking about a development team of 100+ artists here and a company forcing them to work 80 hour crunch weeks leading up to launch like much of the industry.

I don’t know exactly how their 30 or so team members break down for specialties, but I’m willing to bet we’re talking maybe 5 asset artists. Making the tens or hundreds of thousands of concept art pieces, and in game assets. Their time is finite and much better spent working on final assets than making placeholders that will just be replaced later. Experimenting with AI and dripping a placeholder in during month 6 that never gets touched again, and the final asset is made but missed when swapping them in at the end of development isn’t exactly damning

Literally removing work from a human(concept artist)

It’s not really “removing” work from a human, it’s utilizing the time of a very small and limited team more wisely. The AI didn’t replace a human, there was never going to be an additional person hired just to make that placeholder, at worst it just let the existing artists spend more time making final assets.