As a counter argument for the compiler perspective: what Cursor did is basically transpiling a project to another language, which is a form of compilation.

If you distill the feedback into a spec (probably a combination of both docs and tests) which comprehensively covers the functional requirements, then you could treat the code as cached materialization. The value of generating code again is targeting different non-functional requirements, like ability to run in different environments or catering to different performance characteristics.