ctI have an item (a sticker) that weighs 0.1oz and ships in an envelope that weighs 0.2oz, for a grand total of 0.3oz. However, the USPS First Class rate I'm getting is $1.22!! USPS.com lists the price at $0.44. The rule being used is USPS Cheapest Available.
Note that our USPS rate lookups always obtain the Package rate (not any other rate such as postcard, letter, large envelope, or large package), and $1.22 would indeed be the First Class rate for a package weight <1 oz. The packing container types in Admin do not affect which rates get looked up; we just assigned those container type names as a handy mnemonic that would be easier to manage rather than giving them all generic names like Container A, B, etc.