[baq]

Because it isn't really as well defined as you believe, but it has been well defined in context of neuropsychology?

[phowat]

I just searched for "ai hallucination" on arxiv and got 43 hits. And terms get reused in new contexts all the time. I don't disagree confabulating would be a more correct term, though.

[irdc]

This exactly: psychology and psychiatry have fully-developed lexicons for describing various phenomena which AI researchers would do well to adapt.