Makes sense to me. But so anybody can take Public Domain code and place it under GNU Public License (by dropping it into a Linux source-code file) ?

Surely the person doing so would be responsible for doing so, but are they doing anything wrong?

This ruling is IMO/IANAL based on lawyers and judges not understanding how LLMs work internally, falling for the marketing campaign calling them "AI" and not understanding the full implications.

LLM-creation ("training") involves detecting/compressing patterns of the input. Inference generates statistically probable based on similarities of patterns to those found in the "training" input. Computers don't learn or have ideas, they always operate on representations, it's nothing more than any other mechanical transformation. It should not erase copyright any more than synonym substitution.