Is this a simile or a metaphor?On hypnopaedia: "Not so much like drops of water, though water, it is true, can wear holes in the hardest...

It functions as both. Or rather, it functions as an anti-simile and a metaphor. Instead of comparison, hypnopaedia is contrasted with water: "Not so much like drops of water." But after the semi-colon, the structure is metaphoric. There is no "like" or "as"--hypnopaedia is referred to instead as "drops of liquid ceiling wax",not "like drops of liquid ceiling wax." The distinction is minuscule, but essential.

Similes imply similarity; metaphors imply actuality. Although both are comparisons, metaphors are more all-encompassing--exactly what hypnopaedia is described as in this quote. It reflects the almost symbiotic nature of sleep-teaching. Rather than remaining an external force, one internalizes the concepts, making them a part of one's self. Notice Huxley's build-up to that revelation: "adhere, incrust, incorporate." First the ideas stick in one's mind, then they slowly cover the surface, until finally they intertwine completely with one's psyche. So Huxley's metaphor gives life to the nature of hypnopaedia.