Yeah I've had those conversations since GPT-3 first came out. I usually look like the one way off base, but I never did hear a clear explanation of how the LLM architecture could lead to AGI.

In my experience it was a combination of the hype and an overconfidence in the person's understanding of how LLMs work and what AGI actually means. To be fair, AGI definitions are all over the place and LLMs were rarely described in detail beyond "its AI that read the whole internet and sounds like a human."