It seems like you're both talking about different things to me. ?
Mystery chests (the daily ones) are related to Christmas event and not this event and drop faeries and 1 or so cookie knights. You might have been looking at the wrong counter when the cookie knights dropped, that is the monster hunt counter and not the christmas candy counter.
The virtual chests for reaching milestones where you only get a splash screen is the monster hunt, but you may have only gotten coins. I agree that there should have been a splash screen but will need a few more players to post to see if there is an issue with the 1300 milestone. (I'm not up to there yet)