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Even if you could generate real-time 4K 120hz gameplay that reacts to a player's input and the hardware doesn't cost a fortune, you would still need to deal with all the shortcomings of LLMs: hallucinations, limited context/history, prompt injection, no real grasp of logic / space / whatever the game is about.

Maybe if there's a fundamental leap in AI. It's still undecided if larger datasets and larger models will make these problems go away.

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I actually think many of these are non-issues if devs take the most likely approach which is simply doing a hybrid approach.

You only need to apply generative AI to game assets that do not do well with the traditional triangle rasterization approach. Static objects are already at practically photorealistic level in Unreal Engine 5. You just need to apply enhancement techniques to things like faces. Using the traditionally rendered face as a prior for the generation would prevent hallucinations.

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