Yeah... that is quite the unique characteristic. Reminds me of Freeze Shock and Ice Burn (though they belong to a legendary and are much more powerful than a Flamethrower or Fire Blast). Its kind of a shame that doesn't play out in the games, that would make Houndoom quite the unique fire-type, aside from it having a mega form. Granted, I think it gaining a mega form was a much appreciated upgrade.
While I personally prefer Arcanine over Houndoom, they're both great Fire-types. But having that "toxic flames" play out in the games, that might give Houndoom something to make it stand out among its fellow Fire-types