Well, it seems the FB stuff only causes blistering and no other side effects. All previously effected dwarves are healed now, although a new case flares up now and again when somebody walks through some of it. Unfortunately, I'm suffering the bug where dwarves stay in the hospital even though they are healed now- can't wait for the next update to get that chunk of the military back.
I also decided to fill up the well, as long as I was messing with my hospital. Right now the hospital is situated directly beneath the moat. There is a hatch cover there to regulate hospital water flow. The moat itself is dry now, pending the completion of floodgates. The half of the moat nearest the hospital is ready for operation. My plan was to open the floodgates, let the water flow way the hell down to the hospital hole, fill up the well and then close the floodgates and the hatch.
I'm used to operations like this on a stream- not a major river.
A FLOOD OF 7/7 water comes barreling down the moat. In a matter of (realtime) seconds, the well is mostly full. In the time it takes for dwarves to scramble to the levers, the well overflows and the hospital itself floods to 6/7 in most places, 7/7 in some. At this point I would like to emphasize that half a dozen dwarves are comatose in the hospital due to the aforementioned bug.
Somehow, they didn't drown. From what I saw, they were never in any danger. Just chillin under 6/7 water, resting, no other problems while random peasants frantically deconstructed the doors holding the water in the hospital. The waters are draining into the rest of the fort now, so no casualties. Unfortunately, the water seems to have washed the blood and noxious FB extract off of the dwarves and spread it out across the hospital floor, the hallway, and some surrounding rooms- including my main booze stockpile. I'm contemplating a uniform that enforces socks and shoes on ALL civilians.
EDIT: just as I posted this, somebodies pet rabbit bled to death. Presumably from blisters, as I don't see any other cause and there are no combat reports. A morbid portent of things to come.