I only found out myself a few years ago (and I felt dumb at the time, too - he did a great job in making it all feel real).

But yeah, it makes the story even more interesting, because he's critizing and praising and talking about his own work - he can take on the editing and publishing industry, and he can write a story that defies genre. It's a lesson in looking past authorial intent. Which is probably why I'm so blithe about doing that with Tolkien. The author's point of view is just that - a point of view.