Good question.Ideally sheathmakers should be using veg-tanned leather.Your friend was right in that some cheaper sheaths are found to use Chrome tanned leather which is not good as a liner for sheaths or holsters.
First and foremost knives and guns should not be stored long term in thier sheaths and holsters, because any moisture the leather has in it or has absorbed will be in contact with the steel, and even stainless will rust and discolor.
When looking to have a sheath made,the maker should dye and seal the inside and many don't.Unsealed leather will wick up moisture much quicker and the fact it simply is taking shortcuts.The sheath should be firm and offer some retention even without the aid of an additional strap.ALL fixed blade sheath should have welts ( a strip of leather sewn between the layers to protect the stitching) and if it doesn't have one, walk away. There should be no metal (snaps or rivets) coming in contact with the knife.Dave