Answer: What you are seeing are seed pods. You can collect the seeds and plant them. Here's how:
Step 1. The seed pod should be gathered while the seeds are ripe. The pod itself will have just cracked open.
Step 2. Carefully pull the seed pod apart by using your finger tips to hold the cracked opening of the pod.
This will expose the seeds and they should easily fall from the pod.
Step 3. Fill a gallon zip lock bag with 2 inches of barely damp vermiculite. Place the seeds in the bag. Zip the bag shut and shake to distribute the seed. Place in indirect sun light (choose a bright but shady site outdoors or you can set the bag under fluorescent shop lights).
Step 4. Check the bag occasionally. You should notice green leaves growing in 2 weeks. When most of the leaves are 4 inches tall, it is time to carefully transplant the seedlings to their own pots or in a flat.
Step 5. Holding the little plant by the tip of the leaf, gently remove it from the vermiculite. (don't handle it by the stem - you could accidently damage the tissues and the plant will die.)
Step 6. Place the seedling in a small pot of partially fill soiless mix.
If the root is longer the the pot is wide, let the root form a circle in the pot.
Step 7. Cover the seedlings base with soil up to the point that the white part of the stem is covered.
Water well. If the soil level drops below the green part of the leaf, add additional soil and water again.
Step 8. When your day lily is big enough, transplant it in the ground.
Good luck with your project!
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