Definitely label them for the nut allergic people.
I also had the experience of needles rusting during storage in wool. Wool makes good diaper covers because it will absorb a lot of moisture, so I am not in favor of it for needles or pins any more. I don't know how much lanolin would ameliorate this, either. (At this point my mind always wanders and thinks hmm, someone could run a controlled experiment with one with lanolin and one without and figure it out. Original research = Thesis Topic!!!)
Next time I get my hair cut, I'm gonna have to try the hair stuffed pin cushion experiment. If it works out, hey! Presto!