I think you started this thread to get other people to agree with you and did not consider that their bar for calling abuse could be in a much different place.
I don't believe he has 'emotional scars'. I doubt he is that neurotic and overly sensitive. She just missed a step. [Like I said, she has a lot to learn -- but she's trying.]
The generally accepted method to create sensitivity and movement is to use a stick or a whip. If one has to use something like that (or a hoof pick if that is what you have in your hand.) to get a horse to listen and move quickly, then you use it, get the desired response and then you go back and rub the area or make harmless motions to that area so the horse gets the difference between getting hit or poked because he ignored a handler and getting too jumpy and goosey. You sensitize the horse with the whip, stick or whatever and then you go back and desensitize it and put it all back in perspective for the horse.
They need to learn to 'move and move now' when asked. (I use a "Smooch!") And they need to learn to stand when told "Whoa!"