It does ruin the illusion that you need crazy million dollar servers to run the model and the world would fall in to chaos if the public got their hands on these models.
To be fair, the world only just got their hands on this (and by world I mean people with decent hardware), so too soon to say what the ramifications will be.
Also to be fair, the job "AI ethicist" probably didn't exist as a real thing until a few years ago. So the people in those roles over at OpenAI likely have no idea what they're doing.
suppose one has an idea for a different architecture / functional form etc, assuming the receiving model is substantially smaller so that the dominant computational cost is in the SD model, how long would effective knowledge distillation take on say a CPU?
That’s called teacher-student learning. It could still take weeks on a single machine easily, but renting more GPU time or getting free credits from somewhere is perfectly plausible.