I actually often have the opposite problem. The AI overview will assert something and give me dozens of links, and then I'm forced to check them one by one to try to figure out where the assertion came from, and, in some cases, none of the articles even say what the AI overview claimed they said.

I honestly don't get it. All I want is for it to quote verbatim and link to the source. This isn't hard, and there is no way the engineers at Google don't know how to write a thesis with citations. How did things end up this way?

Yes, and it's slowly killing those websites. Mine is among them and the loss in traffic is around 60%.

Snippets were already getting Google in legal hot water (with Yelp in the US and news agencies in Australia in particular IIRC) long before LLMs and AI scraping. It's a debatable gray area of Fair Use growing out of early rulings on DMCA related cases, and also Google's win over the Author's Guild at SCOTUS.

Of course Google has a history of copying articles in whole (cf. Google Cache, eventually abandoned).