The strange blasts is caused when you fire up the z axis. If you fly a jet in bf2 and go vertically up and fire your bullets will look strange. The same thing happens with FS although its far more apparent due to the space setting and the visible blaster trails. We've looked into fixing this issue, but it seems as if its an engine flaw which we can do very little to fix.
We're looking for constructive critism, so that second explanation about the flight controls is very helpful, thanks for the feedback 