There you go, scripts and fpm from the video.
This was one of the first things I did in GG btw so not sure how readable the scripts are.
The principle behind it is quite simple, each torch and each candle looks for a flame to associate with, for the static_torch script the flame decal is located and hidden then when the handheld torch is within a certain distance the flame decal is unhidden. The candles are just on all the time.
If you don't have all the correct entities to make it work you can swap them for something similar and just tweak the positioning offsets in the scripts, the handheld one being the trickiest to get just right. You may also have to play around with the FOV setting in the tab-tab menu to get it looking right.
Handheld torch comes from Mega Pack 2, table and candles from Mega Pack 1.
Been there, done that, got all the T-Shirts!