The writing style and grotesque subject matter reminded me a lot of Mikhail Bulgakov's Heart of a Dog. Granted, I read that many years ago so the connection might be very, very loose.
I really enjoyed Dolly City. It's macabre, funny, and thought-provoking. I can't help but feel like I was missing a lot of the cultural commentary, although some of it became clearer after reading the "epilogue" type thing at the end.
While reading, it definitely comes across as one of those books in which EVERYTHING is metaphorical. Castel-Bloom's writing is very sharp and nothing is superfluous, down to the most absurd detail. The story progresses rapidly and years fly by in a matter of pages. Although the story is engrossing (I could barely put it down), I did kind of get the feeling that Dolly City wasn't really about the story, but rather more about what the story was trying to say. I don't quite know how to word it, but that's the one aspect of this book that was a little disappointing to me. Although I loved that it was very "in your face" and provoked you the whole way through to read between the lines, at times I wanted to enjoy the bizarre story as simply a story.
Definitely one of those books that I would like to read again (and in fact, probably SHOULD read again).