The "AA101 " part of the formula simply outputs "AA101 ". Fairly simple.
The next part, which could be reduced to "&CHAR(ROW()+64)" takes the row number, adds 64 to it, then expresses that as as ASCII character. Everything's sweet if you don't want more than 26 rows.

At its simplest, you can get the sequence expressed in the second part of your post by changing the first part of the formula, so it becomes:
="A000 1A1"&CHAR(ROW()+64)

If you're wanting something more sophisticated than that, you'll need to say exactly what you require.

__________________
Cheers,
Paul Edstein
[Fmr MS MVP - Word]