I think the telling part of TFS is:
> but the leverage being used to fund AI investment was increasing "very rapidly,"
The leverage is indeed what's driving this (and all bubbles). Companies getting an investment then get to puff up their notional (or real) share price, which they then use to borrow against. They then invest that borrowed money in some other company, who does the same somewhere else... and so it goes on - perhaps circularly back to the first company in the chain.
The problem with leverage is it's a multiplier. It just takes a little wobble somewhere in the chain, and then whole thing collapses pretty spectacularly because the leverage multiplies the risk, multiplies the downsides etc etc. The companies who are leveraged really can't influence the outcome - if the leverage collapses, then so do they. What's left is arguably the "real" value of their businesses, and in a lot of cases will be almost nothing.
I'm not up to doing this, but I'll bet these analysts have already looked at (say) OpenAI and tried to figure out what the "real" value of that business is. That is, take out all of the leverage and look at assets, revenues and so on. All companies are probably over valued on that basis, so that alone isn't really the problem, but how much they're overvalued, and the dependency on other businesses to maintain that value definitely are a concern.
As for the Australian pension funds... if AI "pops", it'll take a lot down with it, but that doesn't mean there aren't companies worth investing in, or companies that are likely to be insulated from any fall out. Some of those companies may well even be American, European, Asian etc, so "reducing allocation of global equities" may be a bit more extensive than necessary (just because it's an Aussie business that doesn't mean it won't struggle).