The Wall Street Journal story on Steve Jobs’ statement on Flash includes some telling quotes:
Dave Wolf, vice president of strategy at Cynergy Systems Inc., a Washington, D.C., design firm, calls Apple’s no-Flash policy “a pain.” Mr. Wolf had planned to build mobile apps for clients using the new Adobe software; the apps cost upwards of $40,000 a piece, meaning that without such a tool most customers can only afford to build apps for one device. They almost always choose the iPhone, said Mr. Wolf.
“If it weren’t for the play against Creative Suite we wouldn’t have to make a choice, we could say you could make it in Flash.”
And that’s the point. You wouldn’t be making iPhone apps: you’d be making Flash apps. There’s a difference.