Those cholesterol crystals certainly seem to suggest the possibility of craniopharyngioma. But, craniopharyngiomas do not have a smooth outer surface and do not just "pop out" into the neurosurgeon's hand. Here was my first glimpse of the histology the next day Cholesterol clefts and giant cells. Note in the upper picture that this xanthogranulomatous reaction appears to be continuous with the choroid plexus. Could this be a xanthogranuloma of the choroid plexus? I considered that, until I looked elsewhere on the slide and saw this
This is the ciliated epithelium characteristic of a colloid cyst of the third ventricle, a tumor that can indeed "pop out" into the neurosurgeon's hand. Gross inspection did not reveal a cyst per se because the exuberant xanthogranulomatous reaction obliterated it. Cases like this have been described in the literature. For example, Dr. David Louis and colleagues wrote in a 1994 article entitled Third ventricle xanthogranulomas clinically and radiologically mimicking colloid cysts: Report of two cases (Journal of Neurosurgery. 81(4):605-9, 1994 Oct.) that "histopathologic examination revealed xanthogranulomas of the choroid plexus with only microscopic foci of colloid cyst-like structures." I would argue quite the opposite: that the xanthogranuloma derived from the colloid cyst and extended into the choroid plexus. Indeed, Dr. Peter Burger and colleagues write in the fourth edition of Surgical Pathology of the Nervous System and Its Coverings that "a xanthogranulomatous reaction occasionally supervenes in colloid cysts, largely replacing the epithelium in some cases."