What should I do with this horse?

You should not be smacking around on this horse. I have always said you should never hit your horse unless you think he is going to kill you, and I've never been in a situation, even with dangerous problem horses, that made me feel that way. Since I've never seen this horse, you have to make the decision. Sounds like he is too much for you to handle. Perhaps someone who can dedicate their time to only this horse would be better, someone who is more equipped to deal with his problems. Nothing is worth getting hurt.