Their broods have dwindled over the years, hunted as they are for the mythic powers the pelts are said to possess, so that now only the craftiest of the weresheep remain, none greater than Sheridan the Riftsplitter.
Rumors of how they came to be vary from town to dell, but most believe it to be a blessing gone wrong, perhaps a wayward shepherd who thought to seek protection from a goodly god who turned out to be a wicked wizard in disguise; or mayhaps it was a foolish man who inquired in earnest to a god in the ranks of Chaos for a robust herd of weresheep who soon lost his flock and his life for his errant request.
In any case, the incident marked in history more than eight-hundred moons ago and factors little into current times, as the effect has never been re-doubled. It could be that the god responsible had a thought to the tune of, "Welp, never doing that shizz again!" And so the weresheep still among us hide for their lives as the last of a one-off race. All but Sheridan, that is.
It is worth noting that weresheep have the ability to "portal" between universes parallel universes. This happened randomly, and no creature--or god--has been able to reproduce the skill; though there may be many a sorcerer splattered against the closed gates in neighboring temporal rifts. For the weresheep, presumably they portal until they find a safe haven from mortal hunters. The idea seems fantasy, though this is the sentiment Sheridan declared publicly previously, and would explain their disappearance and sudden reappearance over long periods of time.
The pelts some have fashioned out of hunted weresheep occasionally served as something more than a large warm shoulder blanket; some were said to be unbreakable, make the wearer able to converse with sheep, and others immediately disappeared and were never heard from again. Others just got a large warm shoulder blanket and nothing more.
From the possession of the sight into other, slightly shifted worldverses, a wisdom superseding that of even the gods has been gained in doing so. This gives the remaining weresheep who have mastered this talent a prophet status. It is worth note that the prophecies they bring may be but mere cautionary tales depending on very minute changes from one parallel world to another.
A mix of being clever and lucky gave Sheridan the Riftsplitter his safety in the Sphere, and now many spheres if his talks are to be true. Valuing the information passed from other possible realities, a sect of gods have given Sheridan "immunity from harm" meaning any aggressive action is met swiftly by a stronger counter-force of divine retribution, usually fatal. This gives Sheridan the ability to come and go with impunity, though often the sheep-prophet will forget which reality is the one meant to be reported back to, as the differences between "this one and about forty others, ba-ba-ba-by!" are quite diminuitive.