You can turn it off if you don't like it. I can't count how many times I've accidentally flipped the mute on or off on my iPhone just having it in my pocket.
My 1st gen iphone had a terribly flimsy volume switch that completely wore out just over a year after I got it. I don't think my 4S has ever toggled unintentionally and seems more solidly built but I haven't had it for close to a year yet. The mute switch on my old 3GS (now wife's) is also still working fine (volume up/down broke off awhile backthough).
The other thing I like about flip to mute is that it's an easier gesture to execute than toggling a switch or a two or three step mute on some other phones. I can never remember which way is off on the iPhone so I always flip the switch twice until it vibrates.
It's not a game-changing feature, but there are lots of little details like that on the S3 that make it feel like something Samsung really put a lot of thought into.
