I've never used a lap-top in a live situation or with recording/sound generation but I would regard it as a wider part of over-all computer music, which has a long and distinguished pedigree. So I wouldn't necessarily separate "laptop noise" from digital/computer music in general. In that, I regard it more as a recording method rather than a live tool, but I've heard (rather than seen) perfectly satisfactory uses of laptop in the live setting. Two main examples,
Thendi Soddell and Merzbow (separately). Soddell's performance was particularly good because she played behind the audience, so there was nothing to see.
Re. applications - surprised to see
AudioMulch not mentioned yet. One of the few applications I have paid for (and I still use an older version), it is pretty much nearly everything you'd want. Excellent for mangling samples in real time.
Also had very satisfactory results using the standard effects on good old Cool Edit which, to my ears, have sounded neither too digital-sharp nor low-fidelity muddy.
