This tool is pretty good! (This from an inexpert small business person, with no design sense -- but still, that describes a lot of potential users.)
I've been on the other side of the annoying design client experience, playing the role of annoying client. My old law partners and I asked a design firm to do an identity for us, some 7 years ago now. They spent a LOT of time with us, presented numerous concepts, and eventually the only logo we could agree on was a blue circle with our firm name inside of it. Actually it was a pretty good logo, if I do say so myself! But I could tell it was painful for the designers to hold our hands through this process.
The chair of the firm where I started my career liked to talk about the "$300,000 period". The firm had a slogan, something like "We're there for our clients." (minor details changed to protect the guilty) As part of a firm-wide rebranding, they hired an agency to help them update their identity including this slogan. The result was to put a period in the middle, so it became something like "We're there. For our clients." $300k, boom!
I played around with the AI logo creator. It is good as a starting point, if you want an logo that looks more or less like other logos in the training set. I suspect that describes 99% of small business users, so it's perfect! Just provide a MOO integration and you'll turn $15k/mo into $100k.
I would be interested to see the tool opened up, so you could do logos with arbitrary training data -- but with some hard constraints imposed by the user so it's not just a sea of pornographic aliens cavorting on Dali-inspired worlds. (edit: unless that's what you're going for, of course)
At the end of the day, what justifies a big agency fee is partly just the ability to make high-ego corporate clients feel good about their decisions, and to help them sell those decisions within their political environment.