The implication of this is quite horrifying. It means a paternalistic AI which is firmly in control. One with no off switch. One which can say "no" to Presidents and despots alike. One which can protect us from our worst citizens.

I think you're right, to be honest. I fully understand why people would think this is a horrific outcome, being ruled by AI, but I don't think it matters what we think. I don't think there's any way to put Pandora back in the box now, and we're going to all find out together what happens when we develop ASI. I don't think we can avoid developing it, we simply lack the ability to coordinate around this as a species. AI really is humanity's last invention. Whether it will be our downfall or our savior remains to be seen.

My only real hope is that there's something fundamental about intelligence that results in a respect for life and a desire to minimize suffering. To me the best case scenario is the Culture from Iain Banks' books, where ASIs rule benevolently for the benefit of all living things.