The question in the headline is a bit of a cliche. If you are looking at art solely as traditional media, used in the same ways as people did hundreds of years ago, then photography itself is not art. I doubt many people would actually argue that stance, so you've already opened up the term "art" to be about the result, not the tools that got you there. Likewise, if collage is art, AI is just digital collage, so the factor of it being made from pieces of other works is also already handled.

Therefore, of course AI images can be art. Just like of course photos can be art.

But the flip side is the more important point. The vast majority of photos are not artistic, and the vast majority of AI-generated imagery is not artistic. Just because something can be "art" doesn't mean that everything generated with those tools is "art".

During the boomer's art hayday of the late 1970s, conceptual art became king. Look at Jeff Koonz who came up with art ideas and then had minimum wage workers build the actual pieces. We used to think of art as something made by human hands, but even decades before our digital era, very few famous artists did more than sketch out a concept which is executed by manual workers (never unionized labor either).