Your mistake is thinking the picture in the thumbnail was the starting point, when that was actually the end point generated by the algorithm created by the guy who won this award. The AI built these words off of a "crackle pattern" someone else identified from CT scans of the scroll

Farritor then trained a machine-learning model on Casey’s crackle pattern. He identified multiple ink strokes and more letters and used them as training data. His model started identifying letters and hints of words that weren’t visible to him. After he submitted his findings to the program, a panel of papyrologists noted 13 letters and identified that the hidden word is “Porphyras” which means “purple” and is a bit of a rarity in ancient texts.

In a related anecdote, one thing that blew my mind was the realization that any "program" or "app" fundamentally packages existing functionality that you can already do without that specific app. Most of the time, it still makes sense to use and pay for the abstraction rather than reinventing the wheel constantly but it is a sobering thought for sure.

The output of the IA was the picture.