There is no universal definition of life; there are a variety of definitions proposed by different scientists. To define life in unequivocal terms is still a challenge for scientists.[5][6]

Conventional definition: Often scientists say that life is a characteristic of organisms that exhibit the following phenomena:

1. Homeostasis: Regulation of the internal environment to maintain a constant state; for example, sweating to reduce temperature.
2. Organization: Being composed of one or more cells, which are the basic units of life.
3. Metabolism: Consumption of energy by converting nonliving material into cellular components (anabolism) and decomposing organic matter (catabolism). Living things require energy to maintain internal organization (homeostasis) and to produce the other phenomena associated with life.
4. Growth: Maintenance of a higher rate of synthesis than catalysis. A growing organism increases in size in all of its parts, rather than simply accumulating matter. The particular species begins to multiply and expand as the evolution continues to flourish.
5. Adaptation: The ability to change over a period of time in response to the environment. This ability is fundamental to the process of evolution and is determined by the organism's heredity as well as the composition of metabolized substances, and external factors present.
6. Response to stimuli: A response can take many forms, from the contraction of a unicellular organism when touched to complex reactions involving all the senses of higher animals. A response is often expressed by motion, for example, the leaves of a plant turning toward the sun or an animal chasing its prey.
7. Reproduction: The ability to produce new organisms. Reproduction can be the division of one cell to form two new cells. Usually the term is applied to the production of a new individual (either asexually, from a single parent organism, or sexually, from at least two differing parent organisms), although strictly speaking it also describes the production of new cells in the process of growth.

This is true the distinction between the two is very necessary, but they are inevitably tied together as well.

I liked your examples of how we might mechanically perform the same functions as those described in the definition of life, but I actually think AI would be the more difficult of the two. Don't ever underestimate the complexity of that pile of goo in your head. As you say, it is the AI we need to go along with it. I can make all those things happen with machines, but it is my brain doing all the work.

I find it interesting that it may be possible to create such an AI that could solely be based in a mechanical world, but that it could only come into existence because of another intelligent being. I diverge, but perhaps it was once possible that we came into being because of another intelligent being? As I said I diverge, and I don't want to do any 'god' chasing today, but it is an interesting thought.

I categorise life into two groups, aware and non-aware. Life takes the form of plants and animals, but humans put themselves into an unique category that has self awareness. Niether is trivial to think about, but I'm sure that we'll figure out non-aware AI long before we reach self awareness.

cheers,
Hoopa