You can compress 20PB of text to 20Gb or even less, if input is super repetitive. So the same with images, if 50% of the images are cats then you learn how to represent the cat pixels with a few vectors and then you could represent all the cats int he world doing all possible cat actions.
But please have the courage to respond to this, when the AI is caught regurgitating the exact text from a popular book, the exact verses from a poem, the exact code function from some code , then how can you defend that is not memorizing things? If a human uses my poem(after they read it) and signs his name under it would you defend them?