there's some kind of spell (I think fear or panic or horror or something) that seems to be frequently used in the BG1 campaign and its screwing up the fighters in my party... they stop fighting and just run all over the place. What is best counter to that?

Horror can cause the status effect Panic, which causes the affected character(s) to run around outside player control. The answer is to Resist Fear (mage) or Remove Fear (cleric). This can be applied prior to the Horror to prevent it affecting them, or cast after the Horror to remove it and protect for the duration. In both cases, be mindful of the limited duration of the defensive spell. Certain characters may also be immune to Panic, such as the Cavalier and the Blackguard. See status effect: Panic for a full list of causes and counters.

There's the level 1 cleric spell remove fear, a level 2 mage spell called resist fear, and the greenstone amulet sold in Ulgoth's Beard. The amulet is your best defense against control spells; albeit a tad pricey (around 10k).

He's one of them but I also have Ajantis in my party and he often seems to run away too which is weird because I was under the impression Paladins (or was that Clerics?) had great saves... or maybe that's a NWN thing idk. Not used to old school AD&D rules for Baldur's Gate.

Saving throws vary by class, and improve with level. Consult the manual or the Wiki for a full list of per-class per-level saving throws, or check your character's Report page for the current values.

Apart from already mentioned spells, potion of clarity protects from fear/panic/charm/confusion.