For starters, this completely blocks generation of anything remotely related to copy-protected IPs, which may actually be a saving grace for some creatives. There's a lot of demand for fanart of existing characters, so until this type of model can be run locally, the legal blocks in place actually give artists some space to play in where they don't have to compete with this. At least for a short while.
Fan-art is still illegal, especially since a lot of fan artists are doing it commercially nowadays via commissions and Patreon. It's just that companies have stopped bothering to sue for it because individual artists are too small to bother with, and it's bad PR. (Nintendo did take down a super popular Pokemon porn comic, though.)
So it's ironic in this sense, that OpenAI blocking generation of copyrighted characters means that it's more in compliance with copyright laws than most fan artists out there, in this context. If you consider AI training to be transformative enough to be permissible, then they are more copyright-respecting in general.
