I'm losing weight while I sleep?

I recently bought one of those fancy scales that also measures body fat percentage and water percentage.  The readings are precise and provide consistent values if I reweigh myself, but I don't know how *accurate* they are.  I'll make the assumption that the readings are accurate for small deltas -- eg even if body fat percentage measurements are inaccurate, they're probably consistently accurate, so if I compare two readings, the change in value is fairly accurate. 

I've weighed myself right before bed and right after waking up a couple of nights in a row.  This is what I saw:

- I consistently lose around 0.7 pounds of water.  This seems about right and agrees roughly with information on various websites. 
- I consistently lose around 0.7 pounds of fat.  This is rather shocking as it represents around 3000 kcal.  My metabolism is really high, but this seems kind of nuts.  Maybe this reflects the digestion of fat in food I have recently eaten.  Perhaps the scale is not accurate even with relative measurements -- maybe the crude measurement method is picking up on something other than fat.
- My dry lean mass (think of fat-free beef jerky) goes down by around 0.4 pounds.  This is probably depleting glucose reserves, or something else of the sort. 

It's interesting that all this weight is leaving me via respiration... it's all CO2 and H2O that I exhale.