It doesn’t prevent observation - it provides evidence that it was observed. Likely with a ton of effort and careful application of steam, etc you could defeat it - but it’s more designed to prevent casual snooping.

So don’t think PGP encrypted but think a URL that records who views it.

Why is it difficult to undo, then redo? Obviously one need to be careful (twice) but that's all

The key is the adhesive which means you have to tear or otherwise undo it before you can unfold it.

I suspect that much of it was simply “how can we fold the letter” taken to extremes as a form of individual expression.

Perhaps wetting and mashing it down changes its shape and strength so it's too delicate to reverse.

I picture it like being more complex than re-folding a street map. It seems a good lot of people mess that up, and it's easy to tell it's happened because some of the folds go the wrong way, and sometimes there are new folds and "puffy" edges that don't belong there.

Just like ironing, where sometimes you see an erroneous V-shaped pleat running down the front of an otherwise impeccable pair of dress pants.