It was actually the Black Isle / IWD dale group making the black hound. There was some Bioware / Interplay licensing issues and disputes that probably played a part in killing it.
J.E. Sawyer has recently said he never wanted it be called BG3 but BG: Black Hound. Btw, did you notice that the stained glass in window in the pub PoE is the same from the BG: Black Hound game? And that you get a stray dog as a pet in that same pub?
