I always get agitated when people talk about how bad flake food is. I buy Formula One and Two flake food, and unless they are ripping me off at Ocean Nutrition, it is said to contain everything that their cubed frozen food contains. MARINE flake food is fine for fish when part of a complete breakfast..er..part of a balanced diet.
Hippo tangs are the shyest of all the tangs IME and they always start out a little sickly looking in a new home, usually having shriveled stomach areas and looking really bad, because I don't think they respond well to fish store tanks. Once you have had the fish for awhile, he will be the healthiest fish in your tank, certainly the piggiest. They are just PAINFULLY shy, and that makes them stress out, but just feed it well without treating it and it should be fine. The "flashing" behavior can be an attempt to dislodge a parasite, or a territorial aggravation response. Either way, it is much safer to let nature run it's course and keep your water params good.