I came across the word — teakettle — and couldn’t figure out what it meant, until I came to a realization that it was two words in one that is. So why is that? Why are the two combined to name one thing? Also, has the word or or description always been like that?
So, you finally figured out that a teakettle is an ettle made of teak. That's great!
(Just kidding, of course.)
What you have stumbled across is not a contraction, but a compound word. You can read a rather technical article about them on Wikipedia. Another website describes them in a more basic way, saying:
Compound words are made up of two or more smaller words that are combined to make a new word with its own meaning. The smaller words that form a compound word are like puzzle pieces you fit together to create a new bigger picture. Take the words milk and shake. If we fit these pieces together, we get the compound word milkshake. (link to original)
The word teakettle is indeed a good example of a compound word, where the two words tea and kettle have been mashed together into one.
Yet another website puts it this way:
Closed compound words are formed when two unique words are joined together. They don’t have a space between them and they are the type that generally comes to mind when we think of compound words. (link to original)
Sometimes compound words evolve, from commonly-paired words to commonly-hyphenated words, to words that eventually get added to the dictionary as a standalone word. (In fact, standalone is a good example of this; you can see in this ngram how the word standalone started to appear about a decade after stand-alone was becoming popular.)