I'm concerned that they aren't informing the fire marshal - what was their justification for this? Could you inform them directly? Over here, if you see something unsafe, and don't report it, you could be just as liable as anyone else in the event of an incident - I don't know OSHA's policy/your laws about that to give you more information I'm afraid.
As for Flamex/Flamebar'ing items - do you have budget/petty cash yourself? If no-one else will, you could always purchase it.
With regards to the actors - what age are we talking about? Just because they have trouble with US/DS, doesn't mean they won't realise that they are holding live fire, and act accordingly.
I've never seen GAMtorches specifically (what an awful video on their site!), but have used similar items with liquid fuel. If they are dropped, the flame is automatically extinguished, so that makes them a whole lot safer.
On the whole, so long as FM is informed, and combustible items are made retardant, and cast are talked through everything, I would be happier to proceed with the effects.
Hope this helps
Cx