Basicly the way I do it is to cut the leather into 1 1/4" squares and soak 7 or so at a time with accure glass epoxy and stack and press. I use an acid brush to soak the squares, and have a press jig I use to compress the blocks, it's nothing more than a couple of 4x4x1/2" plates and a couple pieces of 1/2" angle iron welded to the bottom piece. Put a layer of wax paper down, stack the epoxyed leather, anouther layer of wax paper and stick it in the 20 ton shop press and mash the crap out of it. I leave the block in at least over night to cure. take it out, square it up on the band saw and treat like a block of wood.
I've tried soaking with water and compressing, then soaking with supper glue and so forth, the best results I've gotten so far have been using accure glass and just smashing together. Make sure you work the epoxy in good, that's one reason I like the slow cure time of accureglass.
The reason I do it this way is because I haven't made a full leather handle yet, just leather and stag. A full leather handle can be compressed with the but cap, but I'd probably still do it this way. Makes the leather very tough and stabile. After sanding and polishing and light coat of wax your pretty much done.