Right, but you have to give the new players some rating, and as long as that number remains constant it will also be the mean Elo. Therefore, "new players entering the pool" can't cause a rise in mean Elo. As for lower rated players leaving, that could indeed raise the mean (assuming you stop counting them in the average), but that changes the point from "players have gotten better because of AI" to "worse players are more likely to just give up on chess because of AI", which is a significantly less optimistic picture IMO.
I didn't say they did. What I said was that if the person I was replying to was correct that average Elo ratings had increased because of AI, the mechanism would have to be "AI makes lower ranked players give up" instead of "AI makes players better on average"