Is Emma flirting or is this a younger sister teasing an older brother?

The age gap and the family relationship both can make this a little icky - though people talk about it less than Marianne and Colonel Brandon in Sense and Sensibility

Sir Edward's passionate praise of the Romantic novel is reminiscent of Marianne's dramatic speeches in Sense and Sensibility. This is slightly ironic considering that Edward's earlier rejection of the novel in favor of works that can be used to better oneself falls more under Sense than Sensibility.