I think I might know a little bit about Bark River Sheaths.
The PSK has been through several sheaths through the production runs. The original sheath design was intended to be as compact as possible so the knife could be carried in a Personal Survival Kit, hence the name. All of them were orange; handles and sheath.
The sheath was designed to hold onto the blade, a departure from the norm where the blade "floats" in the sheath. This was done to keep the sheath as small as possible.
The notch on the side of the sheath is there to provide a location for a fishline and paracord wrapping on the sheath. I have one setup like that in my sample cabinet so I can provide a picture if anyone is interested.
When the second run of PSKs was done, we changed the sheath to a slightly more conventional kydex design but none of us was really happy with the resulting sheath so we went back to a slight modification of the original design.
All of the Official Bark River leather sheaths are designed to piggyback giving you a great deal of latitude in choosing your optimal knife package.
We're revamping the sheaths as they come up for production, changing what needs to be changed to assure that the sheath shipped with a Bark River knife deserves to be in the box.
The Kydex sheaths are made with the same eye toward quality. Feelings toward Kydex generally run pretty deep, people love it or they hate it. I'm not entitled to an opinion on the subject, we just build the best sheath we can, regardless the material.