My point is that the term AI originally meant a non-sentient program designed to give the appearance of sentience. By that definition, game NPCs are AI, and so is ChatGPT, at least when it’s not insisting it’s non-sentient.

What you're talking about is the generation (or confabulation) of "new things", that are a staple of neural networks. That is indeed what today's popular use of AI is.

I was arguing from the perspective of the original definition. I don't like how marketing perverted the term in popular culture. As a previous commenter said: language is important.