Hi Norman,
When you first mentioned the scabbard throat, I had assumed the leather had been cut to allow it to be folded and 'glued' to the inner surface (the 'cuts' allow the leather to overlap 'itself' , giving a neater finish. and that they had detached from the scabbard and needed 're-gluing'.
However, since the leather is 'scalloped' I now think that you are right, in that it appears to function as protection to the 'sheathed' blade. This I have not seen before.
I have seen 'raw' lambs wool fixed within the throat of some scabbards (but, not of this type of sword), this had the dual function of 'wiping the blade' as it was sheathed and coating it with lanolin....to help prevent rust.
Love the blade
Regards David