You had to be busy last couple of weeks if you don't know the Steve Gate case. Even if Adobe could by brute force develop flash plug-in for iPhone. Apple didn't provide any technical information/drivers to do so. I believe would take next decade to guess how it works without spec . But this story went beyond that. Flash guys 2-3 years ago begun Alchemy project. Now some achievements of this has been included in Adobe CS5. What this stuff can do? Writing game,app whatever, and compiling it to native C. Yes.. cross compiler. And in CS5 Adobe officially added direct compilation to the C targeting iPhone. And the war begun!

Amazingly other platforms like for example Unity3D are not banned.
Even some open source language based on Action Script called HaXe using similar approach to cross-compile to c++ and is possible to target iPhone as well. Also is not banned. Hope you have more clear picture of this situation. I don't even mention about reasons Jobs gave us in official letter because I don't want to be p**** of once again...