Kim, Yes, the Kreg employee who opens the mail was quite surprised at first, and wasn't quite sure what to think. When she figured out what it was, and that it could be opened, she was just glad he hadn't glued the joint as well! ;)
Not sure about the likelihood of a package like this traveling through the USPS system without being sent back to the sender... but definitely very cool, and a great way to keep your bit safe during travel!
Here's a bit of an exclusive tip for our valuable community members planning to buy a new drill bit. Try and find a Kreg Jig Mini kit... instead of just the KJD bit. They're only a few bucks more than the bit itself, so it's like getting a free Mini jig with your purchase! (a tip you'll only find here)