As a nudge, it's a great idea. As a substitute for vigilance, it's a terrible idea.
I suspect that's why they named it Copilot instead of Autopilot, but it's unfortunately more likely to be used as the latter, humans being humans.
But that does not seem to be it's advertised or configured purpose, sitting in your main editor.
I totally agree with you that prompted help is a big deal and just going to get bigger. We have developed a language for fact checking called MSL that works exactly this way in practice -- suggesting multiple options rather than just inserting things.
One of the things that interests me about this thread is the whole topic of UI vs. AI and how much help really comes from giving the user options (and a good UI to discover them) vs how much is "AI" or really intelligence. I think the intelligence has to belong to the user, but a computer can certainly sift through a bunch of code to find a search engine result and, those results could be better than you get now from Google &Co.
EDIT: they appear to be interested in making it look for similar code, see here: https://docs.github.com/en/github/copilot/research-recitatio...
For example, I wrote a comment along the lines of "Find the middle point of two 2D positions stored in x, y vectors" and it came up with two totally different approaches in Ruby - one of which I wouldn't have considered. I did some similar things with SQL, and some people might find huge value in it suggesting regexes, too, because so many devs forget the syntax and a reminder may be all it takes to get out of a jam.
I'm getting old enough now to see where these sorts of prompts will be a game changer, especially when dabbling in languages I'm not very proficient in. For example, I barely know any Python, so I just created a simple list of numbers, wrote a "Sort the numbers into reverse order" comment, and it immediately gave me the right syntax that I'd otherwise have had to Google, taking much longer.
Maybe to alleviate the concerns it could be sandboxed into a search engine or a separate app of its own rather than sitting constantly in my main editor - I would find that a fair compromise which would still provide value but require users to engage in more reflection as to what they're using (at least to a level that they would with using SO answers, say).