Co-Designing with Algorithms: Unpacking the Complex Role of GenAI in Interactive System Design Education

Generative Artificial Intelligence (GenAI) is transforming Human-Computer Interaction (HCI) education and technology design, yet its impact remains poorly understood. This study explores how graduate students in an applied HCI course used GenAI tools during interactive device design. Despite no encouragement, all groups integrated GenAI into their workflows. Through 12 post-class group interviews, we identified how GenAI co-design behaviors present both benefits—such as enhanced creativity and faster design iterations—and risks, including shallow learning and reflection. Benefits were most evident during the execution phases, while the discovery and reflection phases showed limited gains. A taxonomy of usage patterns revealed that students' outcomes depended more on \emph{how} they used GenAI than the specific tasks performed. These findings highlight the need for HCI education to adapt to GenAI’s role and offer recommendations for curricula to better prepare future designers for effective creative co-design.