you cannot copyright a work created by an AI, such as a piece of art.

That's what I said. Copyright infringement is when there is another copyrightable object that is copy of first object. AI is not witin copyright area. You can't copyright it, but also you can't be sued for copyright infringement too.

if you tell it to draw you a donkey carting avocados, the picture can be used by anyone from what I understand.

Yes. Same for Public Domain, but PD is another status. PD applies only to copyrightable work.