I think it's very possible for the PS hose to melt due to heat from the header. In order to allow for movement of the steering assembly (an obvious necessity), there is a loop in the hose, and that loop brings it very close to the exhaust, even on a car without headers. I suspect that your clearance may be even less.
If I were you, I would do two things:
1. Replace the hose, and make sure to use a rubber hose, not a stainless-braid hose, since you won't be able to inspect the stainless hose for heat damage (the melting would be hidden under the braid). You can buy a roll of the hose that is used for installing automatic transmission coolers at NAPA or similar stores. I have it on good authority that this hose will work perfectly well for the low-pressure PS line.
2. Look at some sort of heat shielding. Some of that mylar-coated cloth stuff that is often used to wrap starters would be one way, or a piece of sheet aluminum, bent and bolted to something. If you feel like taking a drive down here, I have a whole pile of aluminum plate and a pretty decent workshop, so we could fabricate something fairly easily.
Joe
