And no, the threads weren't crossed. The tool threaded in smoothly; it was the action of the puller pushing against the spindle that caused the crank arm to barf it's extraction threads. Basically, the puller walked out and the threads sprung off it in a bunch of coiled metal.
This isn't my first time using a crank arm puller on a ST crankset, I pulled the washer before I put in the puller.
Although I have never had this experience of thread failure with a crank arm, it has happened with other aluminum threaded parts such as the cases on my old Harley-Davidson. It is the result of bad metallurgy/machining in which the material becomes brittle and cracked when the threads are initially made, and is in no way the result of your actions. It is disturbing to see this sort of thing happen with a high end part, and I would expect better from Sugino. I still have and use 2 Sugino Mighty Comp cranksets from the 1970s, which have been pulled many times to service the bottom bracket without incident. I have yet to pull the Sugino 75 cranks on my 3 year old Bianchi Pista Concept, and hopefully I will not have the same problem you've experienced.