I get what you're saying, and if the author were claiming the music as his own composition, I could see it being an ethical issue. College kids using AI to create term papers, do homework, etc. is honestly not 'wrong' per se, but in the end it defeats the purpose of attending school in the first place: to sharpen themselves into smart, functional adults capable of more. It is wrong, in the sense that the one you are wronging is yourself. A bit of a moral 'grey area', if you will.
However, of you are a solo dev, or limited by resources on how much you can spend, etc., using a free AI source to dress up your own work doesn't seem like it's an egregious sin-- as long as you site the source, and don't claim credit for anything you don't do (arrangement, selection, etc.) and give those who are opposed, for whatever reasons, a warning to steer clear.
That said, I reiterate that I get your point of view, but don't necessarily agree with how severe you seem to think the ethical breach is. just my $.02.