The brown stuff is probably just a layer of skin peeling off. All toadstools do this occasionally, so just place it where there will be adequate flow. The cuts should heal as long as it doesn't get infected with the brown jelly/bacteria. You could try dipping it in a iodine/Lugol's solution as a disinfectant/anti-bacterial treatment. Not too strong though. If you do, google it or ask someone else on CanReef what is the right concentration for such a bath. It's also perfectly normal for a coral that's been through some sort of stress (ie. getting dropped & cut) to not extend it's polyps for several days.
Good Luck,
Anthony
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