I don't think "lossy text" is a useful term because it conflates with th*s k*nd *f l*ss* t*xt as well. Lossy compression is designed to be as reversible as it can be to a given threshold. That's not how ChatGPT was either designed or works in practice. There are definitely a lot of mathematical similarities between the two, I won't deny that.

Would "partial knowledge compression" be a better term? Partial knowledge of both English and French is a requirement to reliably translate from English to French. Partial knowledge of both baseball box scores and entertaining paragraph outlines in English is a requirement to reliably translate from a box score into an entertaining outline, right?