The bags are returned to player characters because they are flagged as quest items. The engine itself does the returning and not the mod.
There's no other way to prevent the bags from showing up in trader windows other than flagging them as quest items, unfortunately.
Of course, it could be changed, but then bags would show up in trading windows again, reenabling accidental selling. In XC_Bags, accidental selling is very dangerous due to trader inventory cleanup. You could not get them back.
Anyway, it's not possible to change it so far into the mod's lifetime because I'd fear to break many existing savegames.
Maybe if someone used the mod's code to merge it with a big new mod, and was about to release a version of the big mod with the bags included ..., you could ask for a behavioural change. But that would not be done by me because I don't have time for D:OS modding currently. (... and little motivation to be honest ... ;-)
