What is my cat doing?

Okay, so my cat has this really weird habit. When I'm sleeping at night, he will hop on the bed and start to knead the covers and he will purr loudly. Seems normal, right? Only my cat kneads my legs. I will move them away or try and curl up into a ball and he will follow. It's incredibly annoying because it wakes me up and it's nearly impossible to fall asleep with a cat pushing up and down on your legs with his front and back paws. Also, when I try and move or if I try to gently push him aside, he will make a weird little purr/meow sound and he will bite the bed sheets. Then he will commence in his kneading thing with the bed sheets still in his mouth. It happens like every night. The weird part is, he doesn't fall asleep on top of my legs afterward, so it seems pointless. What the heck is he doing?