Well there are alot of things you can do to optimize flash for search engines. Aside from having all meta data in place I would create an alternative page for non-flash users as well as having all text in the flash file typed in versus using images to display the text since search engines index the text in your flash file. I am sure there is more but overall, its pretty basic.
I agree, I tried switching from an html/css format to complete flash and then my site dropped a few positions on google, I switched back and regained my position.. Anyway, not to defer you, I am sure it can probably be done, I just haven't had much luck with it myself.
Neither parts of that quote are considered cloaking, its providing a link that will show up when flash player is not detected, the user can then click on the link to view the non-flash version of the page. And the other part is providing content to be indexed. Please explain how that is cloaking..
so you are saying that you have created two version of website one is in HTML and other in flash. But again the only non flash site gets optimize.... please explain me this , if you have a site pls send its link .
Placing the flash files inside the HTML files is a good idea. In this way you can insert the META information in it. To increase the crawling of search engine spiders, insert some amount of HTML either below or above the flash element. Put as much text as you can in your flash files so that the search engines can read those files. The text should have proper keywords and in accordance with the website topic. The content that you enter in the flash files has to be something that you wish for the search engine to find out.