The car should follow all the rules of the road and hit the breaks if there’s anything suddenly in the way. Whatever happens after that isn’t the car’s fault.

Exactly. There have been incidents already of automated cars striking and killing pedestrians, and many people see this as a reason to be skeptical of self-driving cars. But you’re always going to have accidents like that. If someone steps out in front of a car, the car isn’t always going to have time to stop, even if the onboard AI activates the brakes immediately.