If your compressor system were in an enclosed box, and you thrust in a flaming lighter, then yes, you would get a fire. It's very difficult to get an explosion, because the gas-air mix needs to be nearly perfect, and the enclosure needs to be very tight. It also doesn't help that a grill has a manifold to properly mix the air with the gas before the burner. I should hope your compressor doesn't. You can't really enclose a compressor system that much because you must vent/cool the condenser coils...no gas build-up.
Your dad's grill was getting a flame, not an explosion. The grill is still working, eh?
In a compressor system, you'd only use about 6 or 8 ounces of the stuff (1/3 of a torches tank), and since the compressor is a sealed, air-tight system under pressure, there's no chance of the flame 'chasing' inside to cause problems, and at best, if you really tried, you might get a flame from the smallest of pinholes. Most leaks would blow out a flame.
Many other 'approved' refrigerants are flammable or toxic, or both.
Let's put it this way, If I were Dow Chemical, would I want you paying $400+ per gallon to me only, or would I want you running down to the hardware store and spending $4 for 3 refills....hmmm. That's why they pay so much money to congress' election funds, and support PAC's (cause they have money to burn at $400 a gallon).