The Red Scabbard is a 4 slot container with a combine button on it. You put both hilts and both blades into it and press combine to create your epic. Often, the scabbard is the last of the 5 final parts that the warrior will obtain due to the difficulty of getting everything needed for it.
If you have a premium Magelo account and do a search for Red Scabbard you will see that there are two different items with that name. One of them is the scabbard before you combine the parts to create the epic, and the other is the scabbard that is used to merge and split the epics between the 1HS and 2HS versions.