Kind of silly for them to go hard at creating this when the non-compete issue was already well known.
And the problem with Flash is processor: it was designed to run on a desktop where processor and HD access is not a problem. As I read it, Flash (as it was originally written) will burden the processor in such a way to actually unbalance the thermodynamics of the phone, as well as being really hard on the battery. Adobe is said to be rewriting the Flash kernel so that it runs in an iPhone friendly way.