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There isn't much information about crazy horse leather and where it got its name from. However, it can be assumed that in some aspect, crazy horse leather got its name from the distinguishable features of the wild west, ages ago. And in those days people didn't ride on cowback, they rode on horseback and carried beautifully aged leather accessories that highly resemble the popular crazy horse leather that we know today. It would make sense to name this stuff after the very thing that the wild west was made of, and that my friend would be horses.
The naming of this type of leather could very well be a take on the shared nostalgia of the west that some still experience today. No one really knows, or at least we don't.