Yes, DE is pretty much silica. It is the skeletal remains of diatoms, a type of phytoplankton. Unpurified DE is roughly 80% silica, 10% metal oxides (calcium, magnesium, aluminum). When purified the metal oxides are removed leaving behind pure silica with a little moisture.
Excess silica will just pass through the system. It is sometimes used to deworm animals this way. They feed the DE to the animals and it shreds the worms in the intestines as it passes through.
I am not surprised the looks you got giving out jars of this white powder. You should have added tiny spoons or a mirror and razor blades with them as a joke.
That is interesting about the Morgellon's. Thanks for sharing.