While I agree with your materialist assessment here comrade my primary point of contention is the incentive structure present in these tools. As Iris best put it in her comparison to Heidegger's human-gestalt model, the human-llm gestalt is an ugly one.
We are on the same page as to the failures of the luddites, my argument is that these tools are anti-worker at their core. Even if the tools are cheap and abundant that would not resolve the fact that they alienate workers from their labor to a degree that can only be mitigated with heavy amounts of regulation and restriction. In contrast your position my take is not that an abundance of the tool will democratize its use, its that the only way to use it safely is with a dictatorship of the proletariat.
This is fun :)