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The reasoning for this is because she possessed Oz's body 100 years ago shortly after her death. While Oz's soul stayed with Jack, Alice now had Oz's body, morphing it into her own image at first, but being able to return it to Oz's original form. Alice, while not being a Chain, can do this and utilize Oz's powers because of this possession, which is the reason why we were fooled into thinking she was a Chain. The reason for her appearing as B-Rabbit less and less throughout the series is because of the contract she made with Oz while he possessed Jack's body, which was basically reforming the contract Jack had 100 years ago and allowing Oz to re-obtain his powers slowly, but surely.

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