I retired my MNKE batteries, one of which is which is shown in post #5. The discoloration has spread quite a bit since then. The batteries are about 1 1/2 year old and suffering from a lot of voltage drop. On a 0.6 ohm coil at very close to 4.2V, I was getting 3.2V under load. When they were new on the same mod and coil, they were making 3.8V.
A shot of them both with wrapper on:
And with a wrapper off:
There was nothing wet inside, the battery casing is intact and there is no discoloration on the wrapper. It is the way the wrapper sits on the casing
BTW, the Sony 18650VTC4 have less voltage drop than these did when new and after almost two months of use I think they are not degrading as fast, but it may be a bit early yet to tell for sure.
A shot of them both with wrapper on:

And with a wrapper off:

There was nothing wet inside, the battery casing is intact and there is no discoloration on the wrapper. It is the way the wrapper sits on the casing

BTW, the Sony 18650VTC4 have less voltage drop than these did when new and after almost two months of use I think they are not degrading as fast, but it may be a bit early yet to tell for sure.