I'm not convinced AI could make a great game, even if was advanced AI. Ultimately, AI functions by copying things. It doesn't put them together in new and meaningful ways. However, it could theoretically provide an endless supply of new content for tried-and-true gameplay.
I'm more interested in whether AI will enable people with little to no programming know-how to build games to their own specifications via in-depth chat prompts. The kind of thing where you tell the AI what to do with text prompts without necessarily telling it things in technical terms and the AI creates what you tell it to. The initial output may be garbage, of course, but the idea would be that you can continuously edit the AI's product with further prompts so that it would be possible to create, immediately playtest, figure out what is fun or not, and then just as quickly edit it again and try something else.
If it gives ordinary people who have brilliant ideas but lack the necessary technical skills and/or monetary backing the ability to create games that at least come close to prototyping their actual ideas. And so we could see so many brilliant new gameplay ideas arrive in the scene. On the other hand, just like now, the garbage created by every sod who thinks they have a great idea will overwhelm the genuinely good stuff. Or perhaps it would be more accurate to say that everyone because everyone could create a game to their own specific preferences, everyone would like their own thing but have no one to share it with. For example, I have found my own opinions on games to be fairly unpopular. If I were to create a game exactly to my specifications, I might love it. But everyone else might hate it. When you get everyone doing that, trying to find any game we actually like becomes kind of impossible. Too much stuff to sift through and none of it will ever meet our standards except for the ones we craft ourselves with AI.