they make "space blankets" out of aluminium and mylar like what are used on satellites as insulation. they may work OK in space, but on earth they are useless. at least, maybe if you can wrap an injured kid in about 4 layers it will be better than nothing - the multiple layers will trap some air. But frankly, get a modern sleeping bag in a compression bag. Mine's about 6" across and 14" long when packed.
Yes, aluminum foil reflects radiant energy back to you but it is also made of aluminum. Aluminum is a metal and metals conduct heat very well so if you touch it, it is like giving your body heat away. It could be used for a different reason if you put it in your survival kit too. If you have food and you want to cook it, I guess you can set it up so it will reflect the sun's energy and cook your food. For example: you could put a piece of foil on the sidewalk on a hot summer day and crack an egg onto the foil. When it gets hot enough, your egg will be cooked.
It's reflective but it's easily torn, it needs to be attached to something stronger like mylar then cut into appropriate sheets, folded and sold as "Emergency Blankets" or "Space Blankets"...
May sound stupid but I was thinking if you had a large bag for a survival kit and had enough room could you use aluminium foil to keep warm? Because its an insulator isn't it? If you didn't have gloves you could wrap your hands in the stuff or even your body to keep warm. I was thinking about this because its light weight. Fairly cheap and compact. Anyone wish to share their ideas is welcome.