“Fair use” is, technically, not actually permitted by copyright law. ISTR that “fair use” is only a defense you can use when you are being sued for copyright violation.

Suppose we create a new AI image generator, and use as training input every image ever made of a Disney character (official images by Disney, that is, no fan art), including every frame of every Disney movie. Could we just use the output images of that AI however we wanted to? (Not withstanding trademarks.)