UPDATE - well the dealership replaced my steering wheel and just ordered me a new shift knob. The leather on the new wheel doesn't feel any different ...other than it's brand new. I think I will treat these with leather protector going forward to prevent any more peeling issues. Too bad the leather tanning process they use for Hyundai cars are not as good as Acura/Honda ... because I never had a problem with those leather parts.
also if you don't have one already, get one of those sunshades that attach to the windshield as the sun can deteriorate your leather and tinting your windows would help too. maybe that will pro-long it's life.