Henry Ford didn't make his cars out of buggy whips. He made a new industry. He didn't cannibalize an existing one. You cannot make an LLM without digesting the source material.
Cannibalizing a <product/industry/etc.> is a common phrase to describe the act of a new thing outcompeting an existing thing to another thing to the degree that it significantly harms the market share, sometimes to the point of figurative extinction. Redundancy is a very common reason for this to occur.
Digesting is a weird way to say "learning from." By that logic I've been digesting news, books, movies, songs, and comic books since I was born. My brain is great big 'ole copyright violation.
What matters here is not the source material, it's the output. Possessing or consuming copyrighted material is not illegal, distributing it is. So what matters here is: Can we say that the output is transformative, and does it work to progress the arts and sciences (the stated purpose of copyright in the US constitution)?
I would say yes to both things, except in rare cases of bugs or intentional copyright violations. None of the major AI vendors WANT these things to infringe copyright, they just do it from time to time by accident or through the omission of some guardrail that nobody had yet considered. Those issues are generally fixed fairly promptly (a few major screw ups notwithstanding).
I don't see how you can claim the second part is true. Cars directly cannibalized other forms of self transportation.