Spawned in the ground

In my newly created world, I spawned underground. Not in a cave either, just in the dirt. After I dug out the space I was in, I had to dig 2 spaces above me to get to open air. I did not suffocate, but I should have. In the attached picture, my legs are still in the stone.

I did not see the bonus chest either, in a jungle it is often missing, sometimes I find the items floating around loose, I'd guessed it spawns where there are leaves and breaks, could it have spawned underground as well?