Man, what a situation to be in.
Well, here's my advice.
1. Try to keep on your step-dad's good side while presenting your information in a calm way. I know that will be really hard--I know I would've gone berserk if anyone hit my dog. But you don't want him to arbitrarily ban Hershey from the house or something. "Patience is a virtue, possess it if you can, seldom found in woman, never found in man."
2. Is Hershey inside full time right now? Congrats on getting him in at all, BTW!
I really, really suggest that you not leave Hershey inside unsupervised yet. If your parents decide he's too much trouble inside, they may ban him from the indoors completely . . . so you'll have to keep him OUT of trouble until he understands the "indoor rules". So I would suggest a crate--if you start feeding him in it and leaving treats in it he may learn to like it or at least tolerate it. If it were summer I would suggest you leave him outside when you aren't around if he really can't stand the crate, but in the winter . . . brrr!
3. Give your dad a spray bottle and tell him to spray Hershey, NOT HIT HIM, when he's being bad. I know some members here will disapprove of this, but my feeling is that your step-dad probably has an "old-fashioned" view of animals, like my dad originally did. If so, you are unlikely to be able to convince him that physical punishment won't work, no matter what books and articles you have. A spray bottle will satisfy his desire to physically do something and will be far less harmful and painful to the dog (and to his relationship with your step-dad) than hitting. Spraying > hitting. Maybe it's not an ideal solution, but you've got to work with the family you have, not the family you wish you had.
4. Do your darndest to anticipate things that will tempt Hershey into trouble (like food left on the counters) and to head them off at the pass by removing the food and encouraging your family to not put food on the counters. Does Hershey regularly counter-surf? Is there anyway you can keep him out of the kitchen entirely? A baby gate, perhaps?
Enlisting your step-dad's help is a good idea because then you can subtly redirect him (your step-dad) into GOOD training techniques. Also, try things like teaching your dog a command *really well* and then have your step-dad "help" you with the command as a finishing touch. He'll feel proud that he (ha ha) was the one who trained Hershey to [name of command here] just right.
*hugs* Don't give up hope. My dad was raised on a farm and started out with the view that dogs belonged outside, that only small dogs were meant to be pets, etc. He wanted to build a doghouse for Ebony outside because he honestly thought she would be happiest out there. (My mom and I nixed this idea.) But after a few years, he got to enjoy talking to her and having her "talk" back (she made these garbled sounds--"eeeeoooorawrawrohhhhhh".) When we finally had to put her to sleep (old age), he kept saying what a good dog she'd been and how she was a dog in a million. Sometimes it just takes time for people to re-evaluate and realize they were wrong.
Also, don't get down about Hershey hating you. I'm positive he doesn't hate you. Imagine there was a child who never had to do any chores or homework or clean his room. An utter lack of discipline is not a good thing for a child, nor is being prevented from going to school. But all the same, if someone came along and started making that child do chores and go to school, the kid might be resentful and surly at first. BUT eventually the kid will get over it and be happier.
