Great construction dramaturgically and funny and heartfelt writing, I was fully engaged and absolutely got jumpscared by the monster. Where you lost me is the AI-art, for me it takes me out of it, I cant see the image as anything but the art-references I recognize (ex Francis Bacon) hacked up and reassembled. I would much rather see an actual artist take on the concept. No hate, I just think you have talent that is obscured by the AI.
The next game will be made without it - this was made at a time when AI art had just released and had an interesting uncanny look -- now that it seeks to just look the same as human art it is less interesting and more nefarious. For ethical and aesthetic reasons I will not be using it in future projects!