I think Ipad needs lots of improvements next release to compete with other "pads" from Microsoft, Fujitsu, Dell...
However, Flash is a difference story. Flash can not become a standard because it's source code is not published. It is Adobe product. Because of this issue, web developers will not support Flash. HTML5 is now being developed and it is considered to take the role of Flash in the future.
So, I think Jobs has a good reason to refuse Flash from not only iPad but also every Apple's products.