It does understand to a certain degree for sure. Sometimes it understands impressively well. Sometimes it seems like a special needs case. Ultimately its understanding is different than that of a human’s.

The issue with the “once OpenAI achieves AGI [sic], everything changes” narrative is that it is based off models with infinite integrals in them. If you assume infinite compute capability, anything becomes easy. In reality as we’ve seen, applying GPT-like intelligence to achieve superhuman capabilities, where it is possible at all, is actually quite difficult, field-specific, and time intensive.