That seems to be a common opinion among artists, I guess because you can see all the flaws in the thing you made and where you wish it were better. Those feelings are real, but they're not true. Your art was fine before; it didn't need any improving, enhancing, or upscaling to be art or to be valuable.
One theory of the true nature of art is that it isn't at all to do with what's on the canvas or what shape the sculpture comes out being, but that art is fundamentally about who is making it, and how they do it, and why they do it that way.
You're asking if what you end up with is "slop", but no one can answer that for you because slop isn't a natural kind. If you want your art process to be a process where you do some sketching and then run it through a graphics card along with all of art history and a short poem, you can absolutely be the artist who does that process, and what comes out will be genuinely your art.
But it sounds like right now you are an artist who does some sketching, doesn't really like the result, and taps something they don't really believe in, instrumentally, for the sake of a more marketable end product. And who then turns to the Internet because actually they feel bad about that process and don't really stand behind it, looking for some kind of approval or permission they can't give themselves.
Develop a process consistent with your values, steal as much or as little as you like (as all great artists do), ignore the opinions of people on the Internet, and whatever you end up with will be art. Act against the compass of your own soul, chasing the approval of others, and the result can only be slop.
So the people training the models are stealing art by using it for training over the objections of the artists, right?
The products of the models couldn't be made without everything that went into the models. But why is (making? using?) those products "theft", and also thereby bad, versus something like stealing spray paint and doing graffiti on the side of the hardware store? Or shoplifting a bunch of figure drawing reference books and cutting them up into a collage?
The fascist project to transfigure the entire history of art into capital they can rent out is obviously wrong. But surely when you steal a thousand works of art and sum them together to make something else, you're making the very definition of a transformative work, right? What about all those human artists where appropriating stuff was an important part of the art?