Ah, yes. The only bit of marketing terminology that has multiple high profile university research labs dedicated to it since the 50s.

literally no definition for intelligence that is broadly accepted

You're conflating human intelligence with what it means in computer science. We have no way of consistently and meaningfully ranking human intelligence. The intelligence being referred to in AI is not the same thing. It's not even comparing apples to oranges. It's comparing the abstract notion of a triangle to a rabbit.
You may as well say "signals intelligence doesn't exist because we can't define intelligence".

Calling things techno babble doesn't help you look like someone who knows what they're talking about making a distinction.

The "AI" retouching in my phone is not prone to hallucination. It predates the hallucination machines. It just does stuff like (mostly) smoothly removing things like strung cable in photos and that kind of stuff, or does some pretty splendid night time photography.

I hate to break it to you, but that's largely generative AI. You haven't mentioned your phone specifically, but the features in question are at least quite similar to googles magic eraser and night sight features.
Unless your phone is hilariously old, it doesn't predate googles use and development of generative AI.
In one sentence you say it doesn't hallucinate, and the next you say it "mostly" smoothly removes things. First, where do you think it's getting what's behind what it removed? Second, what do you think is happening when it fails to get it right?
The computational photography features are largely a machine learning model being applied to techniques used by traditional photographers.

If you want to use them, I don't care. Just don't pretend they're fundamentally any different than using Photoshop AI tools to do the same thing. It's not. You're using an AI based tool to do something that someone else is doing by hand. It's trained on a dataset pulled from every picture on earth ever uploaded to the Internet.
Your perfectly color calibrated hdr+ photo without any weird stuff blocking the sky doesn't get the same credit as a person who meticulously composited and exposed a set of film photos for those bits.