I'm an example of someone who told the elders of personal wrongdoing that normally would lead to a JC meeting. The two elders I talked to decided on the spot that since I was obviously repentant and came to them, then it wasn't necessary to form a JC and the matter was dropped to never be brought up again. I never really figured out how I got out of that one. I was fully expecting to be removed as an MS, to be publicy reproved (at the least privately reproved) and to suffer some shame amongst my family.
I can recall an instance where I partook in such action. It was exactly as you describe and the P.O. and i met with the man who had confessed. The P.O. at the time was a bethel colleague from Service Department and we agreed that it would be pointless taking it to a JC for it had happened some years prior and that the man was clearly repentant in making known something which was unlikely to have otherwise been made known.
I suspect it happens more than we imagine - there are (a few) right-minded individuals serving as elders.
BTW undercover, you're not downunder are you?