The issue is that to preserve the CRDT property the LLM has to resolve the conflicts in a deterministic and associative way. We can get the first property (although most popular LLMs do not uphold it) but we can hardy get the second one.

I read the comment you're responding to as suggesting a way to resolve the conflicts layered atop the CRDT, not as a component of the CRDT itself. You're very right that LLMs are the wrong tool for CRDT implementation, but using them to generate conflict resolutions seems worth exploring.