In my opinion not having Flash on the iPhone is not good for anyone... it isn't good for Apple or Adobe, yet somehow neither one seems to be ready to give in. If it is really just an issue over PDF rendering, it is even worse. If you were putting out a hand-held computer (which is what the iPhone really is) with all the power of the iPhone, wouldn't want to give the consumer the best possible experience? Wouldn't you want developers all over the world to create apps that run on it?
Apparently Steve Job's is either a complete nut-job or a genius beyond all of our understanding. Ordinarily I would say that he is making a huge mistake, but for some reason he seems to pull off some long shots.