Villa have been linked with a swoop for the Republic of Ireland international and reports have suggested Hoolahan is also keen on a move.
Lambert managed the 31-year-old playmaker briefly when in charge of Livingston and then for three seasons at Norwich, prior to being appointed as Villa boss in 2012.
Lambert said: "I had him for three years (at Norwich).
"I brought him to Scotland when I was up there, so I had known what he was like for years.
"When I was the manager of Norwich, he was fantastic, he really was - a big, big player.
"He was excellent. But he is Norwich's player, so there is no point in talking about him. I won't disrespect anybody on that front."
Lambert revealed that he has had little joy in the transfer market so far, but said that Stephen Ireland could make his loan move to Stoke permanent.
The Scot said: "There are lads out there we have looked at and tried, but it just hasn't been possible. There is not really any great update.
"There are lads there we have identified that could bring experience to help the younger ones, but some you just can't do."
On Ireland, he added: "I think (Stoke) are trying to do something at the moment."