AI can not build video games. Not really.

I'm one of those people that see video games as, at least partially, art. The concept of a game is first to construct a rewarding gameplay loop, followed by the art of actually building the aesthetics of the world that contains your loop.

AI generation to make a "game", rendering it from scratch, as you play it, is not even really a game. There's not even really a good way of building out a world. One of the unique features of a game is that it allows people to have both similar and different experiences at different times, as the result of interacting with the core gameplay loop. A "full game" where the AI builds things as a human interacts with it, will inevitably fail because no AI can match the ingenuity of a human, and the AI isn't constraining itself within a core gameplay loop.

The best that AI can actually do is what one guy already has done. I can't remember the name of the game, but a single person is building a heavily AI built Space Sim game like Elite Dangerous or Star Citizen. Lot's of AI generated assets and content around the game he actually built. All it's doing is reduce his personal workload, and make the game cheaper. The core game is still developed by a person.

This is one of the reasons I'm saying that AI is currently a bubble. Most of what is claimed to be AI, literally isn't anything beyond basic algorithm work, or is being badly misapplied to do things that don't make sense. Just like with the Dot Com Bubble, investors are dumping shitloads of money into gimmicks and scams.