[BaculumMeumEst]

That seems more technically accurate but less likely to catch on since it's a much less common word. I think my parents are a lot more likely to understand from context a news story that mentions that "lawyers relied on an AI that hallucinated court cases" than "lawyers relied on an AI that confabulated court cases".

[JieJie]

I feel like "fabrication" is just sitting right there begging to be used.