I only started playing Subeta this year, so this is my first Fireside. I've felt unsure whether to throw the relatively valuable Red Rreign items into the Bonfire, but I've tried it about half a dozen times with some of the cheaper ones ... Except, every time, I get a message that a little fox creature grabbed my offering before it hit the flames and thus I get no reward.

Am I doing something wrong, or just unlucky? I don't want to keep wasting items if this is going to happen every time.

Also, what are the prizes / outcomes for throwing items into the Bonfire? Are they worthwhile, or should I just sell things?

It may have been a bad luck moment. Try again, but try to avoid throwing a wreathed item in. However there is an achievement for getting a "payback" from the Rreign for doing so. The prizes vary from a simple kiss that looks fle like on your HA to wreathed version of the items to some wardrobe things and special foods

"little fox creature" is one of the Fireside challengers, Bandit. He is randomly unlocked after having stolen one of your Bonfire items. Then you will find him in your challengers/event tab. https://subeta.net/petinfo.php?petid=5979250#/BattleGuide/Bandit

I'm absolutely certain I saw another newer player say that Bandit kept stealing their items on a loop without actually unlocking (he's only supposed to do it once then you unlock the challenger), but I can't find the post now for some reason... weird. but if he's not in your event challenger tab as mentions above and keeps stealing your items at the bonfire I would file a ticket to have someone look into unlocking him manually as I suspect it might be 'stuck' somehow.

I believe it's random, he doesn't unlock on his first theft.

If you haven’t unlocked him before, Bandit gets stuck stealing your stuff when the Bonfire opens before staff have released him. Once the Fireside challengers are out, that shouldn’t be an issue anymore.

oh gosh, that was definitely what I was thinking of, my bad & thank you for correcting! i had clearly not osmosed that it was specifically an issue around the battle challengers not technically being unlocked at the start of the holiday orz

No worries! I just wanted to let you know because most of us have had him unlocked for many years now and might not know what causes it :P