Well firstly it’s well known that Ridley Scott hated the AVP films and Fox’s plans to crossover the two franchises which is why he’s tried to retcon the AVP stuff from the timeline. So that’s why you have the continuity error, Ridley simply wants to compact the alien timeline to include: Prometheus, Alien: Covenant and Alien. As far as the sequels are concerned Ridley’s never specifically said anything about them other than he thinks the alien has been overused and isn’t as scary as it once was. But considering his return to the franchise and adding in these conflicting narrative points I think it’s pretty clear Ridley considers Alien somewhat his baby and if he’s not happy with the direction Fox’s taking then he’ll step in.
Now the way I see it is this:
In regards to the Weyland Corporation, I actually prefer Ridley’s version of the company. The Weyland Industries that appears in AVP is much more an Easter Egg and a fan nod to the whole Michael Bishop, Bishop thing in Alien 3. In that film nothing specific really is given away about the company other than it simply financing the expedition to Antarctica. There’s no problem with that but it could really be any company, calling it Weyland is just a bit of nostalgia. In Prometheus and Alien: Covenant the Weyland Corporation is a lot more fleshed out, not only are they financiers for the expeditions but they are heavily invested in robotics, ai, space travel, off world colonisation, etc... We get a lot more insight into the company that ties into the original Alien films without giving too much away. Besides as great as it is to see Lance Henriksen, aside from playing the future Weyland or at least Michael Bishop who is possibly Weyland’s double, it doesn’t make much sense for him to play an ancestor to that Weyland and then, every single Weyland we see anywhere is simply just Lance Henriksen at different points in time. So for me I preferred the exploration of the Weyland Corporation in the Prometheus films.
David created the Xenomorph species ... or did he? Now yes as I’ve already stated Ridley Scott hated the AVP films whilst they were still just an idea floating around at Fox so it’s more than likely Ridley intended this for this film just to throw some dirt on the coffin of AVP. Thing is the manner in which David’s creations are presented are left open to interpretation over whether he actually is the creator of the Xenomorph species. The way I see it is this, the Xenomorph’s in Covenant are indeed created by David but that does not make him the creator of the species because of the methods he uses to make them.
The key factor in David’s experiments is the Engineers black goo. We know this biological compound is designed to rewrite a hosts genetics and mutate them at a cellular level. Indeed in the shots of the juggernaut’s arrival at Planet 4 as David subjects the Engineer population to the black goo we see two things happening. The first, the goo disintegrates the Engineers much as the liquid at the beginning of Prometheus broke apart the Engineer seeding the Earth. The second we see within the infected that some have black goo creatures burst from within them much as a chestburster exits its host. Therefore we know the black goo already is capable of creating the parasitic creatures that Xenomorphs are simply an aspect of. Yes David does refine his creations into the Xenomorph’s in Covenant by splicing the goo with the dna of Engineers and Elizabeth Shaw but that doesn’t really mean anything really.
As you quite rightly pointed out the Space Jockey in Alien directly contradicts the David as creator origin because the derelict is lined with millions of fully formed Xenomorph eggs, the Space Jockey himself was killed by a chestburster and therefore was presumably exposed to his own cargo given what happens to Kane. The catch is the Space Jockey is fossilised something confirmed in the script, novelisation and by the filmmakers. Fossilisation of an organism takes at least 10,000 years. So the Space Jockey and the Xenomorph that killed him lived at the very least 10,000 years prior to the events of Alien. This then predates David’s creations by quite a sizeable amount. Now it could be argued that the Xenomorph eggs were placed in the derelict after this but then why is the ship storing them in some sort of hibernation field that presumably works much like the cryo sleep chambers that the humans use, after all Ripley survived 60 years in a cryo chamber without aging a second. The egg that hatches in front of Kane only does so once he disturbs the field around it thus waking the facehugger, since upon awakening the facehugger immediately attacks Kane, how could millions of eggs be transported into the derelict without disturbing the creatures and how would an external party have knowledge of the inner workings of an Engineer juggernaut. Sure David worked out how to fly a juggernaut but I doubt he could create millions of eggs in the time between Covenant and Alien considering it took him 10 years to create half a dozen eggs and presumably exhausted what he could from Shaw and the Engineers by the time the Covenant reaches Planet 4 hence why he tries to murder Daniels.
So Alien essentially establishes the Xenomorph’s are at least 10,000 years old, Prometheus and Covenant both show the black goo is capable of creating parasitic creatures that are in essence variations of Xenomorph’s. David splices black goo with Engineer and human dna to create a form of Xenomorph. So David basically creates Xenomorph’s by using Engineers and Engineer creations both of which were readily available to Engineers before the seeding of Earth. Now even if Shaw’s human biology was a critical factor in the creation of Xenomorph’s well it stands to reason that Engineer’s interacted with humans initially, Ridley himself said that in the Prometheus universe Jesus was an Engineer so the Engineers had direct contact with humanity. The star maps that are shown in Prometheus are implied to have been shown to human cultures by Engineers so it’s not too far a stretch that the Engineers may have take humans off world for various reasons. Therefore Engineers, humans and black goo is readily available to the Engineers and the Engineers had Xenomorph eggs 10,000 years prior to the events of Alien, probably even longer.
You quite rightly stated the Predator hunting party in LA in 1997 proudly displayed a Xenomorph skull on their trophy wall and the Yautja are well documented in using Xenomorph’s to setup hunts for Young Bloods in AVP media. None of that contradicts the Engineers having Xenomorph eggs 10,000 years prior to Alien. Given the already established timeline and the vagueness surrounding David and Xenomorph’s in Covenant I don’t really see any contradiction. Yes David created Xenomorph’s on Planet 4 but that doesn’t mean he is the creator of the species. Humans can create baby humans that doesn’t make them God. David believes himself to be a God because he has a messiah complex born from a belief that he is superior to humans given his first interactions with Peter Weyland. Ridley does however show many flaws in David’s character within Covenant. The most notable is David’s recital of “Ozymandias” which he accredits to Byron however Walter corrects him by stating that the poem was written by Shelley. This shows that David believes himself to be more superior than he actually is. David despises humanity because he views them as an inferior species seeing mortality as a weakness but is himself limited by the extent of their understanding. As he hasn’t been updated in 10 years he is showing signs of deterioration hence his errors. Because he has created Xenomorph’s in his experiments which he views as the perfect organism he naturally assumes himself to be a God because he has created a perfect life form and he has bought into a delusion of superiority. The humans that encounter him have no reference so they would believe him. But just because David makes an assumption doesn’t mean he is telling the truth as he himself doesn’t have all the facts.
He doesn’t consider that the Engineers could create Xenomorph’s because he believes the Engineers are inferior to humans which he considers to be inferior to himself and in his delusion the possibility of an Engineer creating a perfect life form like the Xenomorph is incomprehensible. But had he taken a detour to LV-426 before flying off to Planet 4 with Elizabeth Shaw he might have found that the Engineers did already create the Xenomorph’s and were using them as a biological weapon in much the same way as they were using the black goo.
So for me the only real contradiction is that between the Weyland Corporation and Weyland Industries. Other than that there is enough vagueness around elements that you cannot draw an outright contradiction. Prometheus has Xenomorph like murals in the head room that are observed by David. An Engineer also births a Deacon on LV-223 after Shaw is infected with a Trilobite by Charlie Holloway who has been infected by the black goo thanks to David. David at that stage is simply observing the substances effects rather than experimenting with it and it results in an organism that is perhaps closer to the Xenomorph than any of David’s Planet 4 horrors. Those horrors as well have likely already been created by Engineers when they themselves created the Xenomorph's via experimentation with the black goo given that the Xenomorph appears to be the perfection of the parasite caused by the black goo.
The last Engineer on LV-223 is also not shocked by the trilobite and actively fights against it in a manner that suggests he is aware of what the creature is and will do to him should he fail to break free from it. Nothing in the Prometheus films contradicts the Predator interaction with the Xenomorph creature as the Predator’s using Xeno’s on Earth with ancient humans is still in keeping with that established in Alien as is the skull in Predator 2. As for the fossilisation process we know the Juggernaut ship along with the Engineer constructs on LV-223 have environments similar to that on Earth thus the process will be similar to that on Earth so although Ridley has tried to retcon AVP there’s enough ambiguity present to support it still being in the continuity, the only clear contradiction is in the Weyland companies.
