When I first got it two nights ago I didn't notice any damage to myself even at close range, and had no party members around to burn. Enter Sirion's party next morning, stage right. I nearly killed myself using it at close range. I then proceeded to use most of the day giving party members burn marks.

As far as I know damaging myself could be the way it's meant to work, but sometimes it doesn't, sometimes it does. The same goes for allies, but then the description of the spell clearly states that it shouldn't.
Btw please don't ever take this spell from me, I love it.