A bit different...
The story that the US Copyright Office tells feels a bit different from what I read in the article:
"In her application, Ms. Kashtanova listed the author of the Work as “Kristina Kashtanova” and stated that she had created a “[c]omic book.” The application did not disclose that she used artificial intelligence to create any part of the Work, nor did she disclaim any portion of the Work"
"Shortly after registering the Work, the Office became aware of statements on social media attributed to Ms. Kashtanova that she had created the comic book using Midjourney artificial intelligence. Because the application had not disclosed the use of artificial intelligence, the Office determined that the application was incorrect, or at a minimum, substantively incomplete. "
In other words: the application by Ms. Kashtanova was a bit misleading.
The discussion about the use of AI also refers back to the discussion of photography:
"[...] if photography was a “merely mechanical” process, “with no place for novelty, invention or originality” by the human photographer, then in such case a copyright is no protection."
So, if you want to copyright an AI-novel, you must show that there is some novelty, invention or originality. At the moment, AI is seen as a merely mechanical process.