Maybe we had different expectations. I was an early Android (Droid OG) adopter and admittedly was one of the people that thought Flash on Android would be useful. Maybe it was simply my perception of it being useless since HTML5 was already making a splash for mobile video (similar to the point you make), but outside of using on vacation to stream a video from Subsonic, I found it to be pretty slow to the point of being annoying to use (the same way most people perceived Android pre-GB/ICS/JB). By time I got a phone like the Galaxy Nexus that could probably power it seamlessly, there just wasn't any use for it any more.
I think the performance varied from device-to-device and from site-to-site. The heavier uses tended to perform worse, the flash games designed for mobile tended to perform much better.
But it's really moot, flash on mobile didn't fail because of quality, it failed because it wasn't on the iPhone. A cross-platform runtime that's not cross-platform is pretty worthless, no matter the quality of it.
