Idunbar & Krazy Kat
" Actually it looks like scabs, I clean it off often, but it usually comes back. It sort of seems as if he was bleeding and what I'm looking at is dry blood."
This sounds exactly like what my kitty has.
Is this the part of the nail that is normally under that sheath of skin? so when you unsheath the nail the bloody / scabby part is revealed?
If so, my kitty has this too. Right now, she is being treated for eosinophilic granuloma or pemphigus (not determined) and every week or so her skin rashes and nail bed scabs will flare up and I give her a half pill of prednisone. She is also on a low allergen diet and regular Advantage in case she is allergic to flea bites.
Pemphigus commonly shows up on the ears and nailbeds.
My kittys toes get sore. If your kitty's nails get sore or smell funny and are inflamed, it might be a good idea to take her to the vet.