Not infrequently when my wife and I purchase sweet bell peppers, we'll
cut them open only to discover that there's what appears to be a tiny
little pepper growing inside.

Does anyone know what causes this to happen, and perhaps more
importantly, are these little pepperlets edible?

Oh, sometimes they're the same color as the "main" pepper, but
sometimes they're rather different (usually green in a red or orange
pepper). Are there maybe two different phenomena going on here?