Art is a term that can apply to many human endeavors. The "art" in aikido is, IMHO, when a practitioner can use the form of aikido to express his or her inner self in a spontaneous manner. The techniques almost dissappear and the master is an island of perfect posture and movement surrounded by a swirling and off balance attacker. This is when I feel I am watching art.
Why can't UFC fighters also achieve this level? Sure, they can, why not? In all the UFC fights I've watched I have only rarely seen this level of accompishment. But just because soemthing is brutal doesn't mean it can't be art.
A guitar player can call himself a musician, but until he/she can really express himself without paying attention to the technique of guitar playing, it coming so naturally from years of practice, then he is not really an artist but rather an imitator, a technician. The same with aikido or UFC.
I think that ring fighting with a return to gladiator rules, i.e. no rules with death as the outcome, would make for great entertainment, very educational, and a much more interesting level of fighting.