I'm not sure how much the functionality changed between A16 anf A17, but the AI chip used to basically replace a colonist brain; removing all other brain implants and other things that affect the brain. In other words, it resets the brain and it shouldn't take permanent damage anymore.

There weren't Auxillary AIs in A16 and I don't think you could install the AI Persona Core, so I don't know whether the AI chip's compatibility with other brain implants has changed in A17. I haven't had the opportunity to test that stuff out yet since the update.

Just tested the AI Persona Core, it removes all other brain implants and resets the brain like the AI chip used to in A16, but also cahnges pain to x150%, consciousness +50%, blood filtration +20%, blood pumping +20%, hunger rate to x150%, and tiredness to x50%.
Although I haven't had one installed for long enough to do stress-testing, the discussions in the commnets section suggest that a colonist implanted with one will have random breakdowns and go into a daze, which was added for balancing reasons.

The AI chip still does some of what it used to, restores the brain to full function. It can now function with other brain implants installed, and doesn't remove anything affecting the brain, including scars, but it does still negate their effects on consciousness.