The sheath cleaning story is a funny one. Problem is that it's way too close to the truth. Small children and old ladies show up every time you clean the sheath. Some horses cooperate and some do not. I regularly touch our boy's tummy/abdomen. I just want him to be used to us touching the nether-regions.
I have used a mild soap to clean but prefer KY. You must rinse off every last drop of soap or lotion but KY (or generic version) is safe to leave on if you don't rinse it all off.
I nearly lost my arm once while cleaning Joshie. You just cannot imagine how very deep those nether-regions are.