Is the use of AES in LoRaWAN correct?
This is identical with CTR mode encryption with a MAC. That's known to be secure.

It doesn't say in your question if:


the Ai blocks are completely unique;
the header is included in the MIC calculation.


If those preconditions are met then I don't see any issue with the protocol.

The first one I cannot verify but seems likely, the second one is certainly true (when I look at the linked document).

Note that the MIC is somewhat short, only 32 bits. For this protocol it could be enough. On the other hand, the AES-128 based CMAC calculation is fine for a MIC.



Disclaimer: this should not be seen as a full review of the protocol, just a direct answer to the question.