There's not that much difference between diffusion models and other auto-regressive models (https://www.youtube.com/watch?v=zc5NTeJbk-k). But I'm of the opinion that Generative AI is a terrible umbrella term. It should include basically all of digital art if we take it seriously. The flood fill / paint bucket tool can be considered AI, any program using a search algorithm can be phrased in AI terms of a sense-think-act loop. Nevertheless I do understand what people tend to mean by it when they're raging. Right now it might best be defined in terms of workflow: a human uses natural language to describe what they want, and moments later a plausible image appears trying to match. This clearly separates it from every other tool in the digital artist's program, even many which one could arguably call generative AI. It also separates it from stock-photo/texture searches done externally to some art program, as those are done in a query language rather than natural language.