As far as the torch stuff,
Johnseye posted this in the coral propagation forum, but it sounds like your question above.
And as far as "chemical warfare" I don't think that's a problem. GSP generally doesn't release any chemicals as far as I know. The torch will sting the living bejesus out of the GSP before the GSP causes any problems. GSP's primary defense mechanism is prolific growth.
I think they're fine together and the torch will make a natural boundary. I would continue investigating why the torch isn't doing well. I have green/purple euphyllia ancora (hammer coral) that is closed up likes yours is, but next to it is my black/gold torch coral, and it's never been happier. They have each gone through periods of being closed up, then opened up nicely, and I don't know why for either, as tank parameters haven't changed much either way.
I would only worry if it gets a brown jelly infection, or you're really seeing tissue sloughing off and bare skeleton at the top/crown of the coral being exposed. Short of that I would just ride it out and make sure your parameters are still good.