Well, dropped D with a capo at 3rd seems good. D, G, A chords (so F, C, Bb with capo), often the F and Bb with no thirds it seems...
What is the Bb played like, is it with the low open e string, Bb and F on the a and d strings at the 5th (8th) fret and the f on the b string on top? Anyway..
You are talking about the chorus, the high notes on 'the sky' ? The high a is on the b string, 7th (10th) fret, the f on the g string, same fret, three open bass strings. Then the change to the Bb chord, same notes just the Bb in the bass with your index finger, 6th (8th) fret on the low e strings, etc.
Thanks for your Input Ingo! This was exactly my first experience with this song. I thought about all the same chords and concluded that yeah — Drop D tuning, 3rd fret, chords like that. But something bugs me... I realised how ugly this arrangement is, I can't even imagine Mark playing something like that, it's too ugly. Especially this ugly Bb chord [5x077x]. It just seems incredibly awkward to me, I
don't want to play it like that. If I'd wrote this tune, this chord I would've avoid in some way, because it doesn't please me in any way.
So I started to find solutions. First and obvious idea — tuning the A string to G. It's a pretty common tuning, Chet Atkins played in that (Ave Maria for instance). It worked out well, then I thought — it's almost Open G tuning, so why not to use this one instead? I tried, and it sounds fabulous. The verse now easier to play and sounds good, but the chorus... it became more pleasing for my ears and sound close, but no cigar.
At one moment I was so sure about Open G that I even created a chord chart on Ultimate Guitar:
https://tabs.ultimate-guitar.com/tab/mark_knopfler/in_the_sky_chords_2201895This is funny, but now I think this was completely wrong as well. After close inspection of 31 songs each time I was able to come up with the sound that pleases me, but not here. Also, there was an example of Mark melting two parts in one in tunes like Smooching (I think the exact transcription of this tune is mission impossible).
I'll soon will list all the things that bugs me in this song and maybe somebody would give his thoughts on that.