His FATHER ratted him out earlier and Homeland Security did NOTHING. Not even putting him on the no-fly list.

But anyway some answers for a surprising fundamental lack of knowledge.  Not in any order.

1.  Shaking an object on fire to put it out is a common.  Try shaking a candle or burning rag/paper vigorously and watch it go out.  Tossing it on the floor?  Well it probably was hot.  I understand the hero burned his hands.  He wanted the object out of his way as he dealt with the passenger.  

2.  Someone prompting the heroic passenger? Not necessarily. Maybe it was someone asking him for clarifications or just making comments of their own.  It was really a lawyer???  Well maybe someone thought our hero stepped on the bomber's constitutional rights to barbecue himself.  This is why the "suspect" should be shuttled to Gitmo immediately so we can put these worries aside.

3.  Only 1 bomber?  Maybe the planners thought 6 or 7 on the plane would actually arouse suspicions or maybe they couldn't find any more people low enough on the alert list to go with this guy.

4.  You don't need heart pills to obtain chemicals in the Middle East.
   

5.  My guess is that the bomber intended to blow a hole in the shell of the plane and was seated at the window for that purpose.  The seat could actually have been chosen very specifically at a weak spot in the structural frame.  Likewise a fire would start which would further have caused damage, smoke and confusion.  In fact just starting a fire would cause great panic in the airline travelers.

6.  As for someone saying "if this is the best AQ can do" I would point out that they only can say that because this attempt failed.
   

7.  Typically people trying to hide stuff from the police and others put it in their bras or somewhere in the vicinity of their pubic area, and finally if they are really serious, in their rectums.  Every kid in a car with MJ or worse knows to do that when the cops stop the car for some reason.
This bomber probably went to the bathroom to retrieve some ingredients and to prepare the material for the detonation back at his window seat where the planes structural integrity was most vulnerable.

Sure there are bomb sniffing dogs, and sniffing machines, and thorough pat downs and personnel x-ray machines that just skim the skin's surface but there aren't enough of these things.

;)

And is this all just an elaborate ruse to allow airport security to feel people's ... um ... ?

The primary use of PETN remains in fuzes, boosters and initiators in military explosives.  Looking to wiki, I note it has an RE of 1.66, meaning a pound of it has the power of 1.66 pounds of TNT.  Again, though, the amount of PETN in a fuze, booster or initiator is relatively tiny - not nearly enough to do anything more than boost the explosion of, say, a blasting cap, to cause a larger body of explosives to explode.  Yes, wiki says PETN is a component of the infamous Semtex plastic explosive, but if he'd had Semtex in this, we'd either be reading about the plane crash, or about the guy who was nabbed with semtex, trying to get on the plane.  

Then there's the whole pair of issues that this was a solo attack attempt and apparently inept in execution.  The first hallmark of AQ operations has been simultaneous, multiple attacks.  That was the core of the Pacific airliner plot, the 9/11 plot, to name two.  The second hallmark was their realtive professionalism:  their stuff tends to work.  AQ has had eight years to refine the shoe bombs since Reid was caught trying to light his sneakers over the Atlantic.  You would think that a competent terrist organization would have given their operatives something more reliable and designed to effect its desired purpose.

So, contrary to the news organizations and governments trying to push the AQ angle, IMHO, this was a lone knucklehead who read what he could and cobbled together something that didn't work.  Maybe he had some "friends" or "helpers", but I kinda doubt this was an AQ operation.