[ame=http://www.youtube.com/watch?v=_wBktYBXMK0]YouTube - A preview[/ame]
Comex, the developer behind the latest and most compatible jailbreak to date, Spirit, recently tweeted a video of an iPhone that is apparently playing REAL Adobe Flash content at full speed. He states in the video description that it is "very preliminary," as can be seen by the minor graphical glitches on the screen, but the fact is that it seems to be opening and executing Flash content just fine. No other information has been unveiled yet; it is unknown if this project is to be eventually worked into Safari as its own plugin or if it will have to stay as a standalone app.
Follow comex on Twitter, and check back to this thread for any future updates on the project.
(Here are the links to the first and the second Flash movie demoed in the video.)