This chapter critically examines algorithmic models of consciousness and their limitations in capturing first-person phenomenological experience. It contrasts computational theories of mind with observer-centric frameworks, arguing that consciousness involves non-computable processes that transcend formal algorithms. Drawing on Gödel’s incompleteness theorems, Penrose’s non-computational physics, and the N-Frame observer-explicit formulation of quantum mechanics, the chapter shows how self-reference, epistemic boundaries, and quantum collapse (actualization) reveal fundamental limits in machine cognition. It introduces the N-Frame modification of the Schrödinger and Lindblad equations, integrating observer focus and finite resources to model the dynamics of conscious actualization. By linking the Gödelian hierarchy, quantum observation, and the P ≠ NP epistemic gap, the chapter proposes that true consciousness, and by extension, conscious AI requires hypercomputational insight beyond recursive systems. The discussion reframes AGI alignment as a problem of epistemic boundary rather than algorithmic efficiency.