It certainly can and I’m sure most of time is done in AE. You can get this kind of effect by simpling masking a frame that you want to be the “cartoon” frame and treating it using whatever color/stylize etc effects you want to get the look you are after. You might then go from moving vision to until you reach this frame then “reveal” this frame using masks or other transitions, hold that frame while some text writes on etc. and then transition back to the vision. These holds can be done using Time Remapping and Hold keyframes.
My question to you is: do you really need to do this effect? It has been done and done again so many times on TV that it’s become a cliche in my opinion.
JD
John Dickinson
Motionworks
http://www.motionworks.com.au