Exodus 29 and Communion

Like many things Jesus said, the Jews would have found more than just the drinking of the blood offensive. They would have also been offended by the concept of eating Christ's flesh, which is akin to cannibalism in the Bible.

The key verse here is this (Leviticus 17:10-14)

“‘I will set my face against any Israelite or any foreigner residing among them who eats blood, and I will cut them off from the people. For the life of a creature is in the blood, and I have given it to you to make atonement for yourselves on the altar; it is the blood that makes atonement for one’s life. Therefore I say to the Israelites, “None of you may eat blood, nor may any foreigner residing among you eat blood.”

“‘Any Israelite or any foreigner residing among you who hunts any animal or bird that may be eaten must drain out the blood and cover it with earth, because the life of every creature is its blood. That is why I have said to the Israelites, “You must not eat the blood of any creature, because the life of every creature is its blood; anyone who eats it must be cut off.”

So in the OT, the blood was spilled upon the altar, not ingested, as it is the blood that makes atonement for our sins. In fact, the reason for the blood itself was as an atonement for our sins, and as such, it was prescribed that it would be spilled before the altar. To drink the blood would be depriving it of it's purpose: to be spent on the altar.

Enter Christ. In John 6:53, he says:

So Jesus said to them, “Truly, truly, I say to you, unless you eat the flesh of the Son of Man and drink his blood, you have no life in you.

So here is is saying that, in order to have life in us, we have to eat of the flesh of Jesus and drink his blood.

So that leaves us with the question: What is the difference between the animal sacrifice, and Jesus' sacrifice? When we answer this question, we find that the animal sacrifice was simply symbolic and temporary. The animal sacrifice itself did not bring life to the one sacrificing, so much as it atoned for their sins, and more importantly, pointed ultimately to Christ. When Christ came, he actually imparted life to those who believe him.

As one commentator said, all true life comes from Christ, not from the animal sacrifices. We have no life outside of Christ. This is why drinking of Christ's blood is acceptable, but drinking of an animal's blood was not.

Or to look at it another way, if Paul is right, and our bodies are the temple of the Holy Spirit, then doesn't it make sense that Christ's sacrifice should happen within our own hearts, and hence the ingestion of Christ's blood and body? The ceremonial system did not impart the Holy Spirit to those who practiced it. It was a shadow of what was to come. Paul puts it like this in 1 Corinthians 6:19:

Or do you not know that your body is a temple of the Holy Spirit within you, whom you have from God?

So, in Judaism, the altar was in the temple, and the sacrifice was spread before the altar in the physical temple, whereas when Christ came and ended the sacrificial system, his blood must be spread in the temple of our hearts.

Hebrews sheds a bit of light on this too. In Hebrews 8-10, the writer speaks of the difference between the blood of bulls and calves and the blood of Christ.
Hebrews 10:1:

For since the law has but a shadow of the good things to come instead of the true form of these realities, it can never, by the same sacrifices that are continually offered every year, make perfect those who draw near.

That is, the old covenant sacrifices can never impart life.

In Hebrews 10:22 he says:

Therefore, brothers, since we have confidence to enter the holy places by the blood of Jesus, by the new and living way that he opened for us through the curtain, that is, through his flesh, and since we have a great priest over the house of God, let us draw near with a true heart in full assurance of faith, with our hearts sprinkled clean from an evil conscience and our bodies washed with pure water. (emphasis mine)

In the old covenant, it was the altar sprinkled with the blood of the lamb, but in the new covenant, it is the altar of our hearts sprinkled with the blood of the Jesus.

As for your original question, Jesus and his disciples were actually sharing a Passover Seder together, not a typical sacrificial meal. The passover, if you'll recall correctly, was the meal that the Israelites would share to commemorate the time that God killed all the newborn children in Egypt, but passed over those whose door sides and top were covered in the blood of the lamb. The disciples were preparing for such a time, only this time it would be the blood of the Lamb of God that would be covering their hearts, causing death to pass by them.

As for the bread and wine, it was typical to eat bread and drink wine for Passover. Today, most Jews will drink four cups of wine as described here. They wouldn't drink the last cup of wine, because that one represents the coming of the messiah. To this day, the Jews don't drink this cup. It's likely that it was this fifth cup that Jesus was sharing with the disciples when he said, in Matthew 26:26-29:

Now as they were eating, Jesus took bread, and after blessing it broke it and gave it to the disciples, and said, “Take, eat; this is my body.” And he took a cup, and when he had given thanks he gave it to them, saying, “Drink of it, all of you, for this is my blood of thec covenant, which is poured out for many for the forgiveness of sins. I tell you I will not drink again of this fruit of the vine until that day when I drink it new with you in my Father’s kingdom.”

So to answer the original question, yes, Communion was instituted in the OT, though the interpretation of it's true spiritual meaning wasn't fully revealed until Christ. Communion, however, is most closely related to Passover as described in Exodus 12, and not to the consecration of priests, as the text in Exodus 29 describes.