It's likely that generative AI in general will be deemed fair use, due to its (generally) transformative nature. Sure, if you really coax it, you can get code or images out that look similar to existing ones, but the courts might see that generally speaking, it produces new content that has not been seen before, especially in the case of images. Google Books literally copied and pasted books to add to their online da…
Just because Copilot might be itself a transformative work which is itself allowed to exist, that doesn't at all necessitate a conclusion that the developers who are using it are going to or should somehow be guaranteed not be committing their own copyright sins if they try to incorporate its output into their own works (any more so than one can or should assume all of the outputs of another human being are free of copyright entanglements, even though no one is as-yet claiming a human being is themselves infringement just because they saw another work).