It can write novels... Like a middle schooler can.

It has excellent style and tone, but its incapable of creating the most important elements. Motivation, suspense, surprise. The things that actually drive people to read an novel. Therefore its novels read like parodies, like its literally trying to be the most cliched story imaginable.

To do so, the AI needs to actually understand character motivations. It also needs a hidden world-state that it simulates, which is different from surface text it outputs.

A novel writing AI is probably an AGI. I've tried writing stories since GPT-2, but there hasn't been much of an advancement in this area. Unlike the explosive improvements in other capabilities.

Are you taking the context window size into consideration? And are you basing this opinion on GPT-3.5 OR 4? ChatGPT does tend to write very flat and full of clichés, but in my experience GPT-4 is far more original and expressive.