Well, the cozy is made. And it's felted. And I put it out on my deck to dry in the sunlight, and it started raining.
All-knit projects are perfect when watching Law & Order Reruns all night. Amazing. I think I only did about 4 hours total of knitting and it was all done while multi-tasking (I work nights and most of my job is sitting around and waiting). I even frogged the thing once because I didn't like how many stitches I'd picked up.
It's drying right now (again) inside on my dishrack. I'm using the bottle itself to shape it, and I think that's going well. It felted BEAUTIFULLY. Now, I have to decide if I want to use the excess (!) yarn to make an I-cord tie for it, or if I want to just use ribbon like I originally planned. Hopefully it will be dry by tomorrow so I can use the water bottle again. I will post before, during, and after felting pictures when it's done done.
Thanks so much for everyone's input!