Hi weetabix :o)
Cycling "counts" for developing cardiovascular fitness and burning fat if you're putting a reasonable amount of effort into it rather than pottering, but I don't think it benefits your leg muscles for running.
16 miles of cycling two or three times a week is unlikely to do any harm, though. It's the "active lifestyle" thing!
I used to do lots of "cross-training" - swimming (slowly!) for an hour at a time, BodyPump classes twice a week, intervals on the treadmill, half-hours here and there on the stepper - and was quite convinced that it was good for my running. Strangely enough, now that time constraints mean I can't go to the gym and can only go to the pool occasionally (and never at 7am), my running has improved enormously and I'm managing 40+ miles a week comfortably without losing weight, which has been a problem in the past. I suspect the "cross-training" was just tearing my fitness down.
Even so, I'm thinking of starting to cycle to work, which is just under 10 miles each way. It takes me almost an hour in the car at busy times, so the bike will be quicker. My daughters have helped by declaring, unprompted, that they hate the before-school club and would rather walk to school on their own in the mornings so I don't need the car. And the practice area is small so I do most of my housecalls on foot anyway.