I don't know about your particular 529, but I once had an investment like what you're describing.
My understanding is that you (and your fellow 529 investors) put money into a pile. The 529 folks divide that pile of money into shares using some arbitrary share count. The 529 folks use that pile of money to buy shares in the mutual fund itself (TIEIX in this case).
So while the share price at the "pile of money" level won't match the share price of TIEIX, you should find that it generally matches the performance of TIEIX less any 529 management expense fees that the 529 folks charge.
I don't think there's any advantage to you of them doing it this way. There may be some bookkeeping simplifications for them. I don't think there's any additional risk either.