Is the ascension of AI Upscaling an invitation to poor optimization?

[Pemalite]

Consoles are limited by AMD Radeon technology.

nVidia is spending transistors that could be used for more RT Cores and CUDA cores for Tensor cores to do upscaling.
We have reached a point of diminishing returns in GPU technology, so we need to "cheat" our way to the top... And nVidia is simply the best at that currently.

Console developers also don't seem to be building their games and technology for the target hardware these days, but will now build their games for "future consoles" by deploying dynamic resolutions, framerates and other features.