I don't think they are butchering his character.. I think at this point they are just laying the ground work for his and Ishaana's story to develop.. through Ridhima and his fight the creatives are trying to show us how much Om hates lies. He didn't believe Bela over Ridhima.. he wanted to come to talk to Ridhima and tell her that she probably has nothing to worry about but Riddhima started accusing him.. even then he said have I ever given u a reason to be insecure... then when she spoke about where their relationship is going he said I need time to think about this and cannot give u an answer right away.
Again when it came to Shivaay he got angry with him because he loves him and has certain expectations of him.. we all have certain expectations of the people we love most and when they don't act accordingly we get upset .. we take the ones we love for granted. Which is what Om did.. he was disappointed in Shivaay... ofcourse once he realised the reason behind Shivaay's act he publicly apologised to him as well. He knows he was wrong.
Shivaay also has that much faith in his brothers that he knows they will come around... this is a fight between siblings which happens. Again through this the creatives are trying to lay the groundwork for Anika to see a different side to Shivaay which would only come out in a situation like this. It was also a way for Anika to see the messed up dynamics of the Oberoi family which was behaving so well with one another... it may allow her to understand where Shivaay's behavior comes from.
Anika and Saumya now see the true extent of the brothers love for one another and that will help them try to keep the brothers together no matter what.
Om has always been an emotional character.. he thinks with his heart rather than his head which is why he is a contrast to Shivaay. Remember the concept of the show is Mind Body and Soul.
Om represents the Soul.. a guy who thinks emotionally rather than practically.. his actions are driven by his emotions which may get the better of him at times.
There are no black and white characters in Ishqbaaz .. everyone has their flaws and its about how they balance one another.