would this alice returns plotline have worked better

It's not so much the plotline as the re-imagining of a fascinating and much loved classic as a vacuous contemporary "entertainment".

Alice is a story of a child grappleing with a dreamscape/nightmare version of the adult world. The contemporary problem in dealing with the original is that it is heavily laden with elements that make sense only if you understand the Victorian era context. It still works for children based on the wild and silly elements but older kids and adults find that they do not understand much of it. Alice can be adapted either by sticking to the original material and trusting that audiences will get it (Maybe not likely these days) or by re-setting it and substituting modern references.

The Wizard of Oz is a charming American fairy tale which should present little difficulty in adapting for modern audiences... BUT. If it is to be aimed at older audiences, it will inevitably be rendered "darker" or "more realistic", ruining it utterly. Even the, generally good 1985 Return to Oz started off with a grotesque sequence of little Dorothy being subjected to electroshock therapy. And then there's Wicked, which is a great example of "grownups ruining everything"...