Yes this is true Flash supports the iPhone well not exactly what happens is Flash CS5 will have a compiler that helps package SWF content into a native iPhone application so at the end of the day your application will be pure Apple Object C. I’m not going to talk too much about this because every blog out there will have a post on the subject so I’m just going to provide links and information your going to want to look into.

 
Updated, I have add a full video on building applications for the iPhone with Flash CS5 (links are at the bottom).

iPhone on Adobe Labs you can find a nice video and some example applications.
http://labs.adobe.com

 
Developing for the Apple iPhone using Flash, Aditya Bansod gets into the details.
http://www.adobe.com/devnet

 
Here are the blogs that I would recommend reading
FlashMobileBlog
http://www.flashmobileblog.com

 
Arno Gourdol blog he also talks about Air 2.0
http://arno.org/arnotify

 
Serge Jespers blog I will quot this “The Flash Platform gives you the broadest possible reach for your applications”.
http://www.webkitchen.be

 
Ryan Stewart Rundown of the MAX News.
http://blog.digitalbackcountry.com

 
Information on Flash CS5
http://labs.adobe.com

 
And to wrap things up applications for iPhone:Developer FAQ
http://labs.adobe.com/wiki