Well heres what i just found on psphacks.net:-
We have a winner in the swf player coding contest.
I just want to officially congratulate 71M from our forums for successfully producing a fully functional SWF player that runs on the PSP.
A few notes concerning the player from 71M:
The player supports Flash 7 action script. Not everything mind you but a good portion of it.
As for limitations, I would say that people will have to bare in mind that the PSP only has 32mb of RAM.
3mb of that is taken up by the program itself, so there isn't much room left.
Having complex vector shapes is also a bad idea as the shapes are triangulated and produce massive triangle lists.
The bottom line is, try it and see what works and if someone is creating a new animation for the player they need to keep testing it to see if it still works.
Sorry I can't give anymore information, but there are so many combinations to cover that I wouldn't be able to list them all.
It might be better to let the community find out for themselves what works and what doesn't.
read it yourself here:
http://www.psphacks.net/content/view/585/2/
Apparently its being released on the 30th of February. I really hope its true because i'm getting my 1.5 on wednesday and being able to play flash on a portable device is something i've only dreamt of (lol) and it would reassure me that i hadn't just wasted £130.