My own perception of Automated Alice differed greatly from lemuru's. I was very pleased to discover that Noon had not written a tired adaptation, or an obvious pastiche. He blended his own wit and his own ideas with the imagery and intention of Carroll. The result was a book that was both new and classic.

Notably, he shows an awareness that the original Alice was not just nonsense. It was a parody, almost a debasing of painfully proper Victorian children's literature, with its incomprehensible morality tales and its unhelpful and demented adults. Noon achieves the same with his mad scientists and his beanary notation. Also lots of encrypted psychosexual juiciness that were distinctly not present in the original.
(both the factual evidence against it and Noon's evident admiration for Carroll suggest that this was not meant as a veiled reference to the apocryphal tales of Caroll as a pedophile)

As for the relation to Vurt, my belief is that this is Alice as it would have been written in the Vurt universe. The appearence of Celia Hobart makes this a little problematic, but if you're having trouble with slippage between story-levels, then you haven't really read Vurt.