Board Thread:General Discussion/@comment-7779702-20130404000656/@comment-11051098-20130820183444

Remember Yamajii's fight with Yhwach. His reiatsu was so high and intense that it appeared like flames around his body.

Now, Isshin doesn't have reiatsu even close to Yamajii's level, but I think it might be a similar case, meaning that the energy that appeared to be gathered around his blade looked like flames, but it doesn't mean that it was "real" flames.