What does barking your knuckles mean?

Answer 1

Where I'm from it means to take a layer of skin off by scraping them against something rough by accident, leaving a nice red raw patch.

The phrase originates from hewing logs by hand with an ax. You usually use a broad ax with an offset handle to prevent hitting your knuckles on the log. I imagine you could still easily slip and hit your hand anyhow. To bark your knuckles in this situation is literally to scrape your knuckles on the bark of the log.

Answer 2

Having your knuckles bruised.