This is, famously, why nobody gets a degree in fine arts. (/s)
Your piano teacher does not give a diploma because she is not offering a university education. If she worked with a few other experts and they designed a coordinated curriculum and shepherded students through it over the course of two to four years, and documented that process to the point where they could file with an accrediting agency, then she could issue a degree in piano.
You can get a BMus in Piano Performance, which is a standard music degree with a piano performance specialisation. It's not a special thing of its own kind, and it's normal for performers in music college to specialise in one instrument, usually with a second as an elective.
Being able to play moderately hard pieces from dots and sight-reading are the entry level requirement. It's taken for granted you can already do that.
The degree part means learning music history, theory, and performance styles, working on performance projects, solo and with other musicians.
The analogy with ChatGPT is that it's taking over the entry-level part of the process. You can't expect to get onto a music degree if you only know how to prompt ChatGPT to produce a MIDI file for your entrance exam.
And in CS, you can't produce good code if you barely know what a server is.
It's all very Dunning Kruger. If you use an LLM to produce course work to get your piece of paper at the end, you don't even know what prompts you should use to do an unfamiliar job, never mind having the skills to do it yourself.
Yes they did actually say that. They go into the process of accreditation that would result in a person or institute being able to give a degree "in piano"
Your piano teacher does not give a diploma because she is not offering a university education. If she worked with a few other experts and they designed a coordinated curriculum and shepherded students through it over the course of two to four years, and documented that process to the point where they could file with an accrediting agency, then she could issue a degree in piano.