I really should clarify that the yarn I used didn't actually bleed. I have not washed it yet. I should have used a different word to explain it. I put the word bleed in quotation marks because that's not what happened.
What seems to have happened is that the yarn got pretty fuzzy while knitting with it (pilling?). It looks like the fibers from the red yarn sort of wove in with the fibers from the white yarn. So it *looks* sort of like the yarn bled. I just used that word to give a visual idea of what it looked like.
I do like the yarn and may still use it, I'm just not sure. I'll wait and see what happens when I do get around to washing it.