The moment I heard about that bizarre Letterman appearance I knew it was for a Borat type film.
Letterman has had a few of these instances: Kaufman, Glover, and Phoenix at least. I'm not quite sure that he isn't in on these.
I'm sure he was in on the Kaufman & Phoenix stuff. In the case of Crispin Glover, he actually is crazy and routinely treats people like shit. (I've heard horror stories from independent theater owners where he's made personal appearances.) In Glover's case, even if Dave knew that some crazy shit was about to go down, I get the sense that he didn't know that Glover was going to nearly kick him in the head. He seemed genuinely shocked & disturbed when that happened, both at the time and then afterwards.