Atomic zombie vs. shop teacher
 

The atomic zombie gives the items in your hand +1 strength and fire/flame damage. What happens when an atomic zombie meets the shop teacher?

The shop teacher puts out your fire. Does this mean you lose your +1 damage from the items equipped in your hands or do you lose all the combat damage from your hands items during the combat?

If you read the atomic zombie card carefully one could even argue that the +1 damage had nothing to do with the fire/flame damage as they are two separate abilities of the atomic zombie. This could mean that you don't lose anything in the combat as the fire/flame attack does not change the total strength value of your character.

Re: Atomic zombie vs. shop teacher
 

The Shop Teacher specifically puts you out if you are On Fire -- the capitalization refers to the card by that name. (It should be bold on the card; that's an erratum we'll note for the next printing.) The Atomic Zombie turns your Hand items into fire/flame attacks, so they have no bonus when fighting the Shop Teacher, not even the extra +1.