AF is kinda a quite broad term, historically has been a lot of decision theory which does tend to make some of the assumptions you are referring to, but thinking about how to model agents more generally is also a core project of agent foundations
I think that the real reason work in agent foundations isn’t that applicable to current models is mostly that it is just a pretty young small field and still has a long way to go. Progress is very much bottlenecked by smart people getting work done, and eventually it absolutely will be able to help us understand LLMs, along with many other kinds of agents.
They are probably referring to these: