Narratively, I don't know. I don't see any reason to expect an explosion, but there's no reason not to run it that way if that's what your table wants to try.
Mechanically, the key question is what action is being taken. If someone is attempting a maneuver with hellfire to remove a holy water related Aspect, the Aspect goes away if and only if they beat the difficulty. If someone is anointing themself with holy water to protect against hellfire, as a GM I'd be inclined to say that that's armour 1. And so on.