Is an alien lifeform covering itself comfortably in flames as a defense mechanism to wane off predators possible? I've heard of microbes surviving the extreme condition of outer space in complete vacuum and receiving high dosage of radiation, and a community of crustaceans thriving in hostile environments like the hydrothermal vents which spews corrosive sulphuric acid and boiling waters everywhere and the list goes on.
Well, I think the "coolest" way to do this would be with a substance like rubbing alcohol that the creature sweats. Of course, having your sweat on fire would kind of defeat the purpose of sweating, which is usually to cool off. But a low temp. alcohol can sustain a flash point at room temperature, so they wouldn't necessarily need to actively keep an ignition source once the flame is lit, as long as they kept producing the fuel.
I was looking for specific temperatures of rubbing alcohol flames and didn't see any from good sources, but I did find this article on a 75C flame - http://www.seas.ucla.edu/prosurf/plasmapro.htm (though that requires exotic chemicals). I've read/seen magicians perform tricks with alcohol and while it still gets hot, a thick skinned creature could definitely do it.
Yes, it is possible. The biggest caveat, however, would be that the creature must be able to create, from food, as much as energy as it is expending in maintaining the fire. For that reason, it will be more realistic if the creature is able to turn on the fire only when it senses a threat.
If the creature in question "sweated" phosphine/diphosphine gas, natural byproducts of organic decay, when threatened then it would be feasible, the gases would have a low energy cost and they self ignite in contact with oxygen. The only issues really are how to store the gas, dissolved in tissue is safest and where to sweat it, you don't want phosphine glands anywhere that the resulting flames are going to lick up onto flesh, like in the armpits or groin but the outside of the arms and legs and across the back and shoulders could all be doable depending on the morphology of the creature in question (biped, quadruped, upright, hunched etc...).