Flamethrower-crazy is a level of insanity where an agent snaps, acquires a flamethrower, and then rampages through HQ with it, hoping to char a few Flowers (or RL people) along the way. For many agents, going flamethrower-crazy is the point of no return, and they go down in the books as Snapped in Action.
The term derives from a famous incident involving Agent Len, which went down pretty much as described above. This incident is sometimes used as a yardstick to estimate the relative sanity of PPC agents: anyone who hasn't yet run through the halls with a flamethrower while screaming "Mr. Rogers! Mr. Rogers!" is probably still fit to work.