The Nativity set was made between 1965 and 1975 as part of a 54-statue collection created by students and teachers of the “F.A. Grue” Art Institute in Castelli, a town in Italy’s Abbruzo region that was known for its ceramics as early as the eighth century B.C. The astronaut is supposed to represent the conquering of the Moon (that is what the protuberance is), which would have been a big deal at the time the set was created. Nobody outside of the people who chose the statues has any idea why these particular pieces were chosen for the Nativity scene, or even if the astronaut is supposed to be one of the sheperds or one of the kings. In the school's studio the scene doesn't look nearly as bad.
Thank you so much, Oshkalaboomboom.