You're allowed to use copyrighted works for lots of reasons. EG satire parody, in which case you can legally publish it and make money.
The problem is that this precise situation is not legally clear. Are you using the service to make the image or is the service making the image on your request?
If the service is making the image and then sending it to you, then that may be a copyright violation.
If the user is making the image while using the service as a tool, it may still be a problem. Whether this turns into a copyright violation depends a lot on what the user/creator does with the image. If they misuse it, the service might be sued for contributory infringement.
It seems pretty clear it's a tool. The user provides all the parameters and then the AI outputs something based on that. No one at OpenAI is making any active decisions based on what the user requests. It's my understanding that no one is going after Photoshop for copyright infringement. It would be like going after gun manufacturers for armed crime.
It’s a tool to you. To someone less tech literate, I can see where they don’t see a difference between this and uploading a copyrighted logo to vistaprint or your custom credit card design.
Who exactly creates the image is not the only issue and maybe I gave it too much prominence. Another factor is that the use of copyrighted training data is still being negotiated/litigated in the US. It will help if they tread lightly.
My opinion is that it has to be legal on first amendment grounds, or more generally freedom of expression. Fair use (a US thing) derives from the 1st amendment, though not exclusively. If AI services can't be used for creating protected speech, like parody, then this severely limits what the average person can express.
What worries me is that the major lawsuits involve Big Tech companies. They have an interest in far-reaching IP laws; just not quite far-reaching enough to cut off their R&D.
just a guess, but in order for an LLM to generate or draw anything it needs source material in the form of training data. For copyrighted characters this would mean OpenAI would be willingly feeding their LLM copyrighted images which would likely open them up to legal action.