Definitely a reg. prob. It sounds like your reg seat or pressure spring or even both were crushed and there for severely weakened. That'll explain why your pressure creeps.
It's been a while since I've had a BL Torp, but I know you can take them apart. Do that before you go and buy something, check the seat and the spring and see if they are intact. If so, clean and oil (a spike over 1200psi coulda wiped out any lube in the reg) and then give it a shot, but be careful
If that's not it, just get the reg rebuilt - only should cost $30-$40 at most. Or you could send to BL and see what they'll give you.
Overall they're good regs and it's not enitrely worth getting a different one unless you're in the market or whatever.
Hope that helps.