Chewing tobacco was actually a common additive to "frontier whiskey."
"The type of whiskey one might find in a watering hole, such as shown in Thomas's work, would likely not be familiar to modern drinkers. By all accounts, it could be pretty vile. Quality and flavor varied widely, as there were few standards or regulations on its manufacture. Some of the more popular nicknames from the Wild West-era might give a clue as to the nature of frontier whiskey: "Mountain Howitzer," "Coffin Varnish," “Tarantula Juice,” "Stagger Soup,” "Chain-lightning," "Strychnine," and "Tangleleg."
Following the Civil War, Western distillers producing the early version of bourbon supplied only about 10 percent of the whiskey market. Some of this liquor was actually distilled from a low-grade variety of molasses, to which could be added burnt sugar, glycerin, prune juice, and sulfuric acid. The remaining whiskies began as grain neutral spirits, which were distilled from corn, rye, or wheat of cheap and uncertain quality at 190 degrees proof or above ( at least 95% alcohol by volume). Grain neutral spirits offered little in the way of flavor or variety. Typically, they were sold to rectifiers who redistilled and mixed them with whatever was readily available, including old shoes, chewing tobacco, turpentine, gunpowder, molasses, or burnt sugar, until the end result resembled whiskey. This "rot gut" was frequently given an extra “kick” by adding cayenne pepper. The product was then sold to wholesalers, who bought liquor in bulk and added additional water, more grain neutral spirits, and other ingredients to increase the inventory and, thus, profits. This step was also usually where any aging occurred. Naturally, the final product had an extremely high alcohol and fusel oil content.
"Indian whiskey" was a homemade alcohol, similar to the later "bathtub gin." Edward Charles "Teddy Blue" Abbott, an English-born trail driver, claimed the concoction was invented by Missouri River traders. He described the recipe in his memoirs: "Take one barrel of Missouri River water, and two gallons of alcohol. Then you add two ounces of strychnine to make them crazy -- because strychnine is the greatest stimulant in the world -- three bars of tobacco to make them sick -- because an Indian wouldn't figure it was whisky unless it made him sick -- five bars of soap to give it a bead, and a half pound of red pepper, and then you put some sage brush and boil it until it's brown. Strain this into a barrel and you've got Indian Whisky."