FWIW, if you want to try and 'save' your issued jacket, you can help make it less ugly by a couple trips through the washing machine. Set it on 'cold', with no detergent, and put it through the wash. When it's done, let it air dry for several days laying flat on the floor on a towel (you can also stuff a towel inside the zipped jacket to help dry the inside out. Make sure the collar is shaped correctly (with the fold at the correct spot and straight with no wrinkles), else it will stay however it sat once it dries. Don't hang it up until it's dry inside and out. Once or twice during the drying, put the jacket on and wear it around for a little while while watching tv or sitting on the computer -- it will help the leather shape to your arms. It shouldn't stretch or shrink during this process so long as you don't use hot water or the dryer. If any of the leather cracks/peels during this process, you're outta luck -- it would have happened anyway, nothing you can do about it.
If you're able to get your hands on some leather conditioner (high quality stuff like Pecard's or Lexol...not the Meguiars or Armor All wipes you find at WalMart), wipe the whole outside of the jacket down after it's air dried. Even better if you can take the time while sitting there watching TV to hand-massage the conditioner into the leather, rolling the skin between your fingers. It will make the leather much softer and pliable...and won't look nearly as • as it does when initially issued. The leather flight jacket aficionados do this hand-massage conditioner routine with their new jackets (some of them do the wash, too) to break them in with a lot of success.
I've done this process with several A-2s and G-1s (including some no-kidding vintage jackets) with no problems. If you're just going to throw your issued jacket in the closet to never wear again, I recommend at least trying it to see if you can salvage it.
