There have been many "Flash Killers" over the years which have faded into obscurity, so you could easily ask whether this decision will be worse for Apple than Adobe. If you think about all the great things that the iPad would be great for (video, mobile video conferencing, games, presentations) you will see that most if not all of them are currently solved with adequate success using Flash today. So, as an iPad user you will probably eventually be able to get all those things on the iPad, but my expectations (and those of many gadget users) are that any new device should add value on top of what I have today... the iPad doesn't (at least not in the way I want it to).
So the argument needs to focus on which technology meets the needs and expectations of the target audience. I just don't see how Apple's latest device will do that. It just isn't as revolutionary as the iPod or iPhone.