[yellowapple]

It's indeed a defense mechanism, but (from what I understand) it has less to do with bugs and more to do with mammals; pepper plants started surrounding the seeds with capsaicin to ward off mammals (which chew up and destroy the seeds) while still being palatable to birds (which ingest the seeds whole and "drop them off" elsewhere).

Then a certain species of primate decided "Grug inflict pain on self, makes Grug happy" and the rest is history.

[quickslowdown]

That sounds like exactly the correction I was hoping for :) and it does make more sense than bugs, especially your bit about birds.

[temp0826]

No problem for birds either who don't have the taste buds for capsaicin. I had to buy spicy bird food for a while to ward off the squirrels. A little cruel maybe.