Yes. system.autoUpgrade runs said updates with a systemd timer which runs once a day by default.
You’ve basically told NixOS to update your system at midnight, or whenever you next boot your computer after midnight passes. That option is intended to do the small, tedious updates on a single NixOS version where you don’t expect much breakage, not distro upgrades.
It will likely trigger a rebuild, fail, and then dump the logs into your journal, where you won’t think to read them.
By default, it will also use nixos-rebuild switch, which is not recommended on major upgrades and may cause kernel panics (?).
While enabling that module is fine, and probably even good practice, I think I would not recommend setting system.autoUpgrade.channel, personally, unless you have a specialized use case (such as a custom nixpkgs fork with your own branching strategy). It makes it awkward to do the manual steps involved in stable upgrades.