This is not so unusual at a highly ranked university. One issue is that the large majority of students in the university were relatively close to the top of their class in high school. A highly ranked university is likely to be a lot of work in most cases. I would not expect NYU to be easy either.
To me this makes a lot of sense. I was actually quite recently using a software program and thinking “whoever made this needs to put a lot more effort into thinking about and understanding the user experience”. This is an important area, and at least my understanding is that art skills will be needed. To some extent you can teach a smart person to code, but teaching a software engineer to think about the user experience or to be good at art might be quite often more of a challenge.
You might want to take the course, see how it goes, and in parallel apply as a transfer student. I would be tempted to also discuss this with your academic advisor.
My impression from your other thread is that you might be a resident of New York State. If I have this right, and if you want to increase your chances of actually having options when the time comes, you might want to think about whether you also want to apply as a transfer student to a SUNY or two.
“Prestige” is not particularly important in high tech, nor in software engineering. Building something that works, and that users want to use, is important. Finding a good fit for you is also important. I also agree with a comment above that I am not sure that there is much difference in the “prestige” of CMU versus NYU (CMU is very good for computer science, whether either is better for studying “user interface/experience” I would not know).
And of course if you apply to transfer, you are not committed yet to actually changing schools.