Does anyone know if sheetrock can be cut up and used as a soil conditioner?

Yes. It is mainly limestone and paper. Paper is a carbon it is OK. The limestone is a pH raiser. It added calcium to the soil.

I've read that you shouldn't use it in your garden because it contains glues and flame retardants.

Gypsum is actually calcium sulfate, it wont change the pH of soil but it does have the ability to control salts in clay soil. There can very well be impurities in sheetrock, I would recommend horticultural grade gypsum if needed.

thanks, so much for recycling my leftover sheetrock.