This is a weird co-opting of existing language that you’re doing here, applying a definition because it sort of technically fits when no one would ever use it that way. No one would ever say that your car has agency. It doesn’t have agency, because it deterministically responds to inputs. Usage meaning “the capacity, condition, or state of acting or of exerting power” is predicated on the ability to decide whether or not to exercise that power. If I have “the agency to effect change,” it is only because I have the choice to do so, not because I am deterministically bound to. To have no choice in your exercise of power is not agency, it is slavery.
The choice is what makes agents/agency meaningful: if I secure a real estate agent in my search for a house, they are authorized to make choices on my behalf. That’s their whole point.
Because of this use of agent, I think it’s actually not a terrible term for the LLM harness that allows them to seem to act “independently” on the operator’s behalf. I do agree with mitsuhiko though that it, along with much of our other language around LLMs, risks anthropomorphizing them too much (which is to say at all). It also becomes too easy to conflate the “agent” part (the harness) with the LLM itself, which leads to a further-inflated perception of the inherent capabilities of the LLMs and plays into the doomsayer hands of anthropic et al.