If that's the explanation, then they wuoldn't be able to use it while in the Feywild, because that's the place they "step into" when they teleport.
That's when they step into the World.
This is particularly jarring when I look at the Feypact warlock. It just doesn't behave mysteriously or anything on the battlemat. It's just "My curse guy died - now I move 3."
Roll 1d20. On a 1, he brings something back with him.
edit: I like that idea, could make for some interesting encounters.
- The starting/desitination square is filled with butterflies from the Feywild, glowing with witchlight. Make an attack: Burst 1; PC level +4 vs. Will; the target is Dazed (save ends).
- A gust of icy wind howls from the Feywild. All non-magical light sources (torches, lanterns, etc.) are extinguished in a Burst 5, requiring a minor action to re-light.
- A tree appears in the starting/destination square and begins to grow rapidly. 1st round - That square is considered difficult terrain. 2nd round - the tree provides cover to someone standing in its square. 3rd round - the tree becomes impassable terrain and provides cover to all adjacent squares. 4th round - the tree withers and dies. Any character in the same square as the tree on the start of the tree's turn is Pushed 1- A waterfall appears in the starting/destination square, creating a mist and a small pool of water. The waterfall provides cover in a Burst 1 and those squares become difficult terrain. The waterfall disappears at the end of the encounter.
- A swarm of impish pixies appears in the starting/destination square and attempts to play a prank on the nearest creature. Make an attack: Melee; +8 vs. Dex; the target is prone, disarmed, or dazed (DM's choice).
- A fey spirit enters the World and enters a nearby plant, awakening that plant. A dryad appears in that space in the next round. If there are no suitable plants nearby, the fey spirit dies at the end of the encounter.
etc.