The preference of setting "AI Images" to None in image search is remembered correctly.
However, it doesn't apply to images that appear inline with web search results.
For instance, for this search: https://kagi.com/search?q=mushroom+house&r=no_region&sh=FtNt7JN-0dzPUr4yKEvnxg
These images are shown:

Some are clearly AI generated, and do not appear when selecting the Images tab itself.
If "AI Images" are disabled in image search for the account, they should not appear in web search results.