Flash has long been a stumbling block in getting found in the search engines. Googlebot just doesn't cope well with content and links embedded within Flash. And if the following e-mail that I received from a Google engineer last year is any indication, Google isn't likely to make significant improvements on how it crawls, indexes and ranks Flash files anytime soon:
"re: Flash, I can tell you, based upon philosophies here, that we aren't likely to do any kind of mapping of Flash to non-Flash URLs. While our spidering practices may change in the future, we find that Flash is not a very user-friendly experience in a lot of ways. It is wholly inaccessible to the sight-impaired, not renderable on many devices (such as phones, PDAs), and so on. In particular, we hugely frown upon navigation done exclusively in Flash."
Given this stance, I'd suggest that the responsibility rests solely in the Web site owner's hands to address the Flash/SEO issue. Luckily you have some options, such as:
1. Replace the Flash elements with a more accessible alternative like CSS/DHTML.
Now this tactic is "officially" Google approved.
This gives merit to SWFObject techniques, which are extremely similar. Here is the key line from Google on the above-referenced Web page:
In other words, whether it's SWFOject or sIFR, the key is to consistently mirror the exact content of a given .swf file in the corresponding text-based replacement.
I was fairly certain that this was the case, but now Google has stated it clearly and precisely.