Because people don't cheat to gain knowledge. They cheat to fulfill a societal norm (getting the diploma/certification etc) that says they "succeeded". Cheating is basically just taking a shortcut to an outcome without gaining the benefit of doing the actual work.

The usefulness of cheating in this scenario is that they can get the result the college requires without doing the work, and still receiving the benefit of achieving said result.

Because we don't generally explain to people why we school them and teach them specific things. We fail quite badly at expressing the why of learning specific skills and we have known that for awhile. AI just created a readily accessible shortcut for some to thinking because we don't and have basically never explained that a lot of school work is about teaching basic ideas and then developing skills to let people scale those ideas up using critical thinking and first principles. We are teaching people to think, not just to know.