Ok, so here are the results of my experiment. You are correct. The tetrasodium edta in question will NOT dissolve in distilled water. The label on the jar it came in is clearly marked tetrasodium edta. First let me say that the texture of the edta powder is odd. It is fluffy like corn starch. The edta I have from lotioncrafters is more granular like salt.
I tried dissolving 50 grams of the edta in 50 grams of distilled water. I ended up with a thick (about the consistency of heavy cream) white slurry similar to what you would get if you mixed corn starch or flour with water. No amount of stirring would get the stuff to dissolve. I attempted heating the mixture in the microwave and stirring more. No luck. I added additional water to the mix and heated again. Still nothing. Nada. Not happening.
The tetrasodium edta from lotioncrafters dissolves easily in an equal amount of distilled water to form a clear solution. This remained an opaque slurry no matter what I did to it.
I would NOT attempt to use this in soap.
At this point, I can't even begin to guess what this substance might be; but if it is tetrasodium edta, it's the weirdest I've run across in my somewhat limited experience. Hopefully, DeeAnna will see this and chime in with some additional insight.
So to conclude, I have 2 pounds of something that is labeled tetrasodium edta, but certainly doesn't act like it.
I'm including some pictures of the experiment so you can see the results.