The Ortlieb Bike-Packer panniers in both the Classic and Plus series offer some breathability with their open tops and loose fitting cover caps. The Bike-Packer designs are not waterproof to kayaking standards, but unless you are fording rivers they are waterproof enough, at least for me, and I ride in rainy Pacific Northwest in Oregon nearly every day no matter the weather.

Sea to Summit has a series of breathable dry bags and compression sacs. I have seen several similar knockoff designs at REI. I stuff my down sleeping bag in a Sea to Summit breathable compression bag and then store it in my Ortlieb Bike-Packer Plus panniers with no moisture problems.

As to environmentally friendly fabrics and coatings that’s a hard one. As has been stated all the popular water proof and/or breathable fabrics are petroleum based. Of the two most common waterproof coatings polyvinylchloride (PVC – think Ortlieb Classic panniers ) and polyurethane (PU - think Ortlieb Plus), urethane is the more environmental and worker friendly. In theory PU coated fabrics can be recycled but you would be hard pressed for find someone to take it. A few more forward thinking outdoor manufacturers will take their products back at the end of their useful life. Both of my Golite tents have tags that say something like “This is not junk. Please send it back for recycling. . .”

I have seen and even worked with cotton canvas coated with natural rubber. I have no idea if it is still produced let alone available for retail. The technology dates back to the Civil War and every so often an order would come through specing it out.

Here are three more etail outdoor fabric stores. I have used all of them and gotten good service.
http://www.questoutfitters.com/
http://www.therainshed.com/
http://www.bearpawwd.com/