I reviewed the HU v1.6 files, and found these issues with Hydra's situation:
1) The Hydra summon (hydra1) in monstats.txt was given the skill "hydraball", but that skill doesn't exist. I returned it (along with hydra2 and hydra3) to using the skill HydraMissile. They were also given a missile called hydraball, so I erased it (they don't use missiles anyways).
2) The HydraMissile skill was using missile hydra2, but rather than investigate that missile, I just switched it to hydraball, as recommended earlier in the thread.
3) The hydraball missile looked like it was a clone of firebolt, so I copied the row for "fireball" and pasted it over hydraball, except for the velocity (22), and range (25). I set the Skill field to Hydra. I changed the explosion range from 5 to 3, as recommended earlier in this thread.
Now the Hydras are casting HydraMissile, which uses a fireball-cloned missile called hydraball, which causes damaged controlled by the Hydra skill. This should be an acceptable fix, but someone should test it very soon.
Modified HU v1.6 files:
https://dl.dropboxusercontent.com/s/8slfnzbtk17l684/HU%20v1.6%20HydraFix.zip?dl=0