I retracted my Aura shield hemisphere and saw that the hound was still alive. The large gash I inflicted was cauterized and instantly sealed by that burst of fire. I definitely felt my sword slash through flesh, so these monsters are still organic creatures and made of flesh and blood and not purely made of fire, but I did not see any droplets of red staining the green grass below.
Did the flame hound cauterize the wound before blood could leak out? There were only pebbles underneath the flame hound.
Wait a sec... there were burnt patches on the grass. Well duh! The flame hounds are covered head to toe in fucking fire, but the weird thing is that their feet, although also covered in fire, aren't burning the grass.