I do consultancy work for Mars Fishcare (owners of API, makers of Melafix and Pimafix) and have direct knowledge of some of the background behind these products. I don't believe these medications cause problems with labyrinth fishes or pencilfishes.
To clear up a couple of minor points first:
I had been treating with melafix from work( concentrated version)
There is not actually such a thing as a concentrated Melafix treatment in freshwater
. When used according to directions they are all the same concentration in the tank water. Some are more or less concentrated in the bottle to make dosing easier.
they do need to breathe air and it is the one type of fish that can actually drown if they cannot get to a surface that is free of a slick
Melafix/Pimafix do not cause a slick at the surface. If you use these treatments you can see that they don't (although they can cause some foaming). They are specially processed with emulsifiers so that they mix with the aquarium water. They also do not lower oxygen levels in the water; this was investigated during development using oxygen probes. (Although I can't clearly understand why people feel a slick would damage the labyrinth organ anyway, seeing as the fish breathes the air above the tank, and not the actual water).
Mars Fishcare (API) spent years developing and testing Melafix and Pimafix (Melafix alone spent 6-7 years being tested and refined). During that time they were extensively tested on labyrinth fishes (Bettas and multiple species of gourami) and also on pencilfishes. They were tested in bare-bottom tanks and 'traditional' established tanks, on wild fish and aquarium strains, and in the case of the pencilfishes at least, pencilfish hobbyists were recruited to help test. Samples of the medication were sent out to them to add to their own tanks with their pencilfishes, just in case there was some unknown factor that was different about the testing facilities at API compared to hobbyists' tanks at home. None of these tests showed any problems with Melafix or Pimafix for either labyrinth fishes or pencilfishes.
When a fish is being treated with a medication, it is because it is unwell in some way (obviously). Therefore, if a fish dies while being treated with Melafix/Pimafix, it is likely to be the original illness that caused the death, rather than the medication. This can even apply if other fishes, which did not appear to be sick and are not the targets of the medication, die during treatment – whatever caused the problem in the first place will have potentially affected and damaged all the fishes in the tank. (Particularly as most problems are caused by poor water quality, which can occur some time before symptoms are noticed). Fishes can also die for no apparent reason, as we are all aware. If this happens after a medication has been added to the tank the owner naturally assumes the medication was to blame, when if it hadn't been added, the death would have been written off as "one of those things".
Some fish die with the first use and others later on
It's clear here for example that Chickadee blames the Melafix no matter when the fish dies. (Sorry, Chickadee, not getting at you personally!). Although this is understandable, it is not scientific.
I think it is important to point out that there is no evidence that Melafix or Pimafix harm either labyrinth fishes or pencilfishes other than these reports circulating on the internet. Mars Fishcare (API) on the other hand, have lots of good evidence that indicates that they don't. It is also important to point out that huge numbers of hobbyists use these products around the globe, so any genuine problems would most likely show up very quickly and be well-known.