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NYC in the ‘80s was a hard time. This is pretty much in line with my recollections…

I feel like there needs to be a model that fixes faces to clean this up. Humans are so attuned to faces that I can imagine it would take a specialized model to render convincing faces. Maybe there could be a layer to identify and occlude existing pseudo-faces generated by Stable Diffusion and another model to populate the occlusion.

This is already done e.g. in Majesty Diffusion. You run another amount of iterations using a face Restauration GAN

Many are doing exactly this with Stable Diffusion + GFPGAN (https://github.com/TencentARC/GFPGAN) as a post-processing model.

And hands. Try searching for ‘hand holding apple’ for instance