The Hanged Man was intended to be the best combat CNPC in the game. Fists, knives, gunshe was master of them all. The player was supposed to be able to find all the CNPCs early on, but they didn't want The Hanged Man to be too good right away. They were still working on how to limit him.
The Hanged Man is wrapped from head to toe in bandages because he's pretty much burned all over. The fact that he's still quite mobile and dangerous is a testament to his badassness. When the PC finds him, he's hanging by the neck from a pole at Fort Abandon, a central Shady Sands-type area in FO3. He's pissed and very much alive, and will tag along with the PC if the PC cuts him down.
Unfortunately, The Hanged Man is also one of the most evil characters around. Rape, murder, robberyhe's done them all. The tribals know his reputation, and having him in the party will make dealing with them extremely difficult. Even the civilized areas are somewhat fearful of him because he's the man with a seemingly infinite amount of lives.
Little is known about The Hanged Man's history. He'll reveal that he's got a connection to Caesar's Legion, and is particularly ticked off at them.
Chris Avellone, who designed him, described The Hanged Man as "the first poisonous CNPC to join the party, like having the Jinxed Dog with you".