You can easily read files/url's with PHP - there should be many examples at hotscripts.com. JavaScript only allows reading of files via ActiveX which requires the client to have Windows Scripting Host installed. Also the only way for JavaScript to read url's is if the client has the Microsoft XML DOM installed.
The only solution was to have use an inline frame to show the target HTML page. It's what Google does with their Ad Sense Ads so it should be good enough.