I've just made a test with soapy water and there is indeed a leak at where the backcap meets the torch body!
It's not a severe thing but there's certainly a leak.
Do you think this will cause all the problems?
Back cap leaks aren't uncommon and yep, can cause this as well as being bad enough to cook the tungsten (grey oxidised mess). As said can bodge it with some tape to test/use if you haven't got a suitable O-ring to replace the knackered one
