There are a number of things that could negate this story, but it is still one of those rumors that you just really hope is true. A screen shot of the iPhone loading the site lonelyplanet.com, shows the device rendering out Flash content on the site. The site has a mini map on the side, that looks a certain way when loaded up in Flash, and also a certain way when loaded up without it.
That is what the site looks like under iPhone firmware 1.1.4, a flat map with no Flash, and no variations. It is clearly very different from the screen shot of a normal desktop web browser, loading the site up, with full Flash support.
As you can see in this screen shot from a desktop, the map is a little fancier. It has color variations, and also hover effects and mouse over actions.
Lastly, this is how it looks on the iPhone 3G. Well, this is how it might look. Clearly the device shows a full version of the page in the browser, but this is almost certainly marketing material. Meaning screen rendering, and this could be an oversight by Apple. On the more exciting side, Apple could have thrown in Flash support and waited for someone to catch on to this little detail, you decide.
[Via iPhone Atlas]