(reason being that the Mainland Chinese did not intend to kill their fellow Chinese in Taiwan), but were fired solely as a political gesture. So the shells were dug up and stockpiled and eventually used to make kitchen knives. True or not, I think it's a pretty cool yarn.
Given that the Chinese civil war resulted in about a million military deaths plus at least that many civilian deaths, there doesn't seem to have been much squeamishness about killing fellow Chinese, so I'd vote for no. It does make for a nice story though.
I think the knives have a cool provenance, but any speculation as to what is in "bombshell steel" of that era? Someone mentioned tungsten. I'd imagine that purity levels weren't as high as modern steels, particularly with the massive quantities needed.