I'm not a lawyer, but I don't think the law is simple.
This is why the original BSD license (with advertising clause) was incompatible with the GPL, while BSD without the advertising clause is not.
"Public domain" is not a license, and has different meanings in different jurisdictions, and thus it can be useful to release code under a license even if the intent is unrestricted use.
I'm guessing there's too much money in that being protected for it not to be protected so, no I think providing LICENSE is still worthwhile.
Congress makes the law then the Court interprets it, which hasn't happened yet.
If choosing the position / angle of a camera and its settings is enough to gain Copyright over the images it generates then prompting a model to generate an image is enough too. I don't see how anyone can come to any other conclusion.
The creativity bar for Copyright is not high. An alphabetically ordered list of customers does not meet it. Pointing a camera at someone and pushing the button does.
Directing is not copyrightable. The person who takes the picture owns the copyright (fixation rule) unless some other contract says otherwise. Saying the prompt writer is a director reduces their claim to ownership.