"After seeing a brief demo of a grotesque zombie-esque creature, Miyazaki pauses and says that it reminds him of a friend of his with a disability so severe he can’t even high five. “Thinking of him, I can’t watch this stuff and find [it] interesting. Whoever creates this stuff has no idea what pain is whatsoever. I am utterly disgusted. If you really want to make creepy stuff, you can go ahead and do it. I would never wish to incorporate this technology into my work at all. I strongly feel that this is an insult to life itself.”
He's disgusted by the creature, not the computer based technique. While he's on record as disapproving of CGI, Earwig and the Witch, directed by his son, used CGI so his disapproval isn't absolute.
"Whoever creates this stuff has no idea what pain is whatsoever."
I think it's clear that he is specifically responding to the the overall soullessness of the technique - to animate without a human understanding of what is being animated. But as others have pointed out this is well before modern AI image gen and I have been corrected in that aspect.
"After seeing a brief demo of a grotesque zombie-esque creature, Miyazaki pauses and says that it reminds him of a friend of his with a disability so severe he can’t even high five. “Thinking of him, I can’t watch this stuff and find [it] interesting. Whoever creates this stuff has no idea what pain is whatsoever. I am utterly disgusted. If you really want to make creepy stuff, you can go ahead and do it. I would never wish to incorporate this technology into my work at all. I strongly feel that this is an insult to life itself.”
He's disgusted by the creature, not the computer based technique. While he's on record as disapproving of CGI, Earwig and the Witch, directed by his son, used CGI so his disapproval isn't absolute.