A: It sounds like the steel may have been overheated during the hardening process.
Most chisels are made from simple water-hardening high-carbon steel – traditionally AISI W1 or similar. It hardens by heating to 1450° to 1500° F (788° to 815° C) then quenching in water. (Other steel alloys may be quenched in oil or air.) The blade is then tempered at a lower temperature, say 325° F.
Overheating above 1500° F during the hardening process causes the formation of large grains in the steel. The blade will seem properly hardened – a Rockwell hardness test will even confirm it. But those large grains are fragile. They’re not stuck together as well as they should be had the part been kept below 1500°. Hence your crumbling edge problem.
The only test for this condition that I’m aware of is a destructive one: you must break the part and do a visual study of the internal steel. Properly hardened steel will have grains that are so small they look matte gray, almost like gray primer paint.
Steel that’s been overheated, on the other hand, will have visibly large, sparkly grains.
It’s possible that the blade could be rehabilitated by having it heat treated over again, but without knowing the exact alloy it would be a bit of a crap shoot.