Cycles of drafting and revising are crucial for student writers' growth, and formative assessment plays an important role. However, many teachers lack the time or resources to provide feedback on drafts. While research suggests that AI feedback is high enough quality to be used for draft feedback, especially when assignment-specific criteria are used (Steiss et al., 2024), it must be used in a human-centered process. AI has the potential to reduce educational equity gaps in writing support (Warschauer et al., 2023), but when narrowly implemented, technologies can deepen divides (Stornaiuolo, et al., 2023). Peer and AI Review + Reflection (PAIRR) combines peer review best practices with AI review in an approach that emphasizes student agency and reflection. Using a mixed methods approach, this study examined student perceptions of AI utility in the context of peer review. Results indicate that AI tools offer useful feedback when combined with peer review. Students found the similarity between AI and peer feedback reassuring, while also valuing their complementary perspectives. Moreover, by evaluating AI outputs, students developed AI literacy, gaining familiarity with AI feedback's affordances and limitations while learning ethical ways to use AI in their writing processes.