Or it could be something bad cunningly designed as a fairy house, bwaaa ... not saying that's likely, but it is a little concerning that JDub's dog had such a negative reaction (unless it was picking up vibes from JDub and JDub's spidey sense was off, so two separate "if"s).
I've only seen fairy houses that were small, made out of twigs, and meant to blend in -- but if you guys have really seen things in this category that look like this, fair enough.
I'd guess not geocaching, since those things are supposed to be harder to find.
Though you never can tell what individual humans will do.