It's not a practical weapon, and no one sees it as a threat, hence the almost complete lack of laws in the U.S. Even in WWII, it had limited use. No one wanted to be the one carrying either, since you became a target of enemy fire with an explosive backpack on. This thing is also incredibly dangerous for the user as well; just look at the protective gear in the video. Sure, it's whacky and unnecessary for most people (some people need a portable flamethrower for clearing land on large properties, but that doesn't seem to be the marketing here). But some people might say the same about your hobbies and spending habits. Let bygones be bygones.
Nobody said that "it's a practical weapon", just that it's incredibly dangerous. It's perfectly suited to kill, mail or deface for life a busful of random people. In this case not even the "if we outlaw handguns, only outlaws will have them"-argument flies, because you don't protect yourself from a flamethrower with another flamethrower. In fact, a flamethrower is not suitable for self-protection, only for attacking large numbers of soft targets. It's the perfect mass murderer's weapon.