Rachel was taken prisoner when her telepathic powers manifested themselves. She was subjected to intense mind altering drugs and hypnosis that did a real number on her mind and might possibly have made her more susceptible to other forms of mind control.
She was forced to use her telepathy as one of the first Hounds, mutants enslaved by the government to hunt or kill their own. And, in true Claremontian style, it only made sense that a Hound would wear a costumed made of studded, black leather and a leash.