magic fire blast maybe it's very hot and sure it feels like it's burning the flesh of your chest but in actual fact the pain the heat all of it is psychological it therefore makes sense that the "illusionary flames" dissapated with the embers on squalls clothes but Squall was never really going to be burnt by it. As for Seifer shooting early and scarring Squall I am going to say it is because of the intense rivalry between them ever since they were kids (although they really only remember the time after joining Garden but still they hated each other bitterly) therefore by actually moving to cut Squall he shows superiority yet Squall has never accepted the fact that Seifer may be superior or his equal in skill retaliates by giving Seifer the opposite direction scar as if to say "yeah you can take me down but remember I'm always going to get up to kick you in the ass" sorta thing.