Myelin sheath helpWatch
What si the effect of demyelination on the neurone?
In terms of how it's formed - just google it:
for example: "The myelin sheath is formed as individual cells extend their plasma membranes around the axons of neurons in a spiral fashion. In the central nervous system, these are called oligodendroglial cells, while in the peripheral nervous system, they are called Schwann cells.
As such in answering your final question, a removal of this removes the benefits of it. In other words it slows conduction down dramatically. A condition you may consider that this involves is MS; there are also motor nerve diseases (ALS being the most common).
In terms of structure and how it is made that sounds a little too complicated for AS. However, as you correctly said in the PNS it is Schwann cells that are responsible, and Oligodendrocytes in the CNS.