The full version - which was still current in my early service - was "crabfat" which was indeed the nickname of the specific issued against pubic lice, ie crabs.
It's colour was precisely that of the then (whenever that was) RAF uniform, be it the current blue/grey or the transient ex-Russian sky blue.
All good stuff, apart from the fact that the Royal Navy is recorded as referring to the paint used for warships' hulls as "crab-fat" long before the Royal Air Force was formed, and that the name for the ointment subsequently derived from the colour of the paint ......
Jack
PS Re: ".... an RAF blue
ungent ....." - Could have been one of many"!
