It's a package, which has multiple games within it, but under a single key.
The rules state: "Try to refrain from entering giveaways for packs if you already own the majority of the games contained within.", so if Sassdrake only owns 1, he should be able to enter, but is asking to be polite.

Now, if Sassdrake activates that key, he has done all that is required. All parts of the package will show as owned in hit game list and all is good.
If Steam happens to give him a giftable copy of GW2 as he already owns it (which I highly doubt it will), then it is completely up to him what he does with that code.

.... Just checked, and it looks like Steam will NOT give a giftable copy of the extra game, so it'll just be swallowed up.
So all is fine.