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There are many initiatives that teach Artificial Intelligence (AI) literacy to K-12 students. Most downsize college-level instructional materials to grade-level appropriate formats, overlooking students' unique perspectives in the design of curricula. To investigate the use of educational games as a vehicle for uncovering youth's understanding of AI instruction, we co-designed games with 39 Black, Hispanic, and Asian high school girls and non-binary youth to create engaging learning materials for their peers. We conducted qualitative analyses on the designed game artifacts, student discourse, and their feedback on the efficacy of learning activities. This study highlights the benefits of co-design and learning games to uncover students' understanding and ability to apply AI concepts in game-based learning, their emergent perspectives of AI, and the prior knowledge that informs their game design choices. Our research uncovers students' AI misconceptions and informs the design of educational games and grade-level appropriate AI instruction.