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A beautiful purpose or a purposeless beauty?
I have been asked to do entire web sites in Flash many times. The reason I almost never do is simple; Flash does not meet my design requirements, by failing to separate the four elements of a web site.
I have been using Flash extensively in product development over the last four years primarily for customer facing kiosks where it can be loaded once and then use XML and XML sockets to communicate with databases and software. This scenario and similar ones such as games and hand held devices are often ideal for showing the power of flash as a User Interface. In these scenarios where the interface is at least as important as content it often has fewer overheads and a better user experience than HTML (but similar to AJAX). It does however take noticeably longer to develop in (very hard to be object orientated) and is more time consuming to maintain. AJAX and it's predecessor DHTML should strongly be considered as alternatives.
Flash is not versatile at all when you need to change or update your web site. Flash is not a good tool for web design because it was originally created as a low bandwidth animation system, i.e. Macromedia Director with smaller files.
Flash is an excellent animation package. It is also very good at creating interactive games. I have been using Macromedia Director since my school days, when, what was then called MacroMind Director, was only at version 2. In web design Flash is often only appropriate for small specific applications such as animating a logo on a web page or creating a dynamic walkthrough style map. I do not think entire web sites should be designed in flash as the vast majority of web sites are about content (or should be) and the accessibility of the content should be paramount.
Many if not all of the effects you have seen on Flash web sites can be replicated using DHTML (Dynamic HTML) and now AJAX (Asynchronous Javascript and XML) which are based on open standards backed by everyone. are backwardly compatible with older browsers, do not require a plugin and will work with any browser including those on PDAs and Mobiles.
The reason DHTML/AJAX is not used more is that many "web designers" are from a media background and thus already trained to use Director, hence Flash is second nature whereas DHTML would require them to learn HTML, Javascript, XML and CSS, as there are currently no packages that can create good DHMTL/AJAX web sites.
While a complex DHTML/AJAX web site might be expensive due to all the programming, it is comparable in price to a complex Flash web site, which is also difficult and time consuming but in a different way. The difference in the long run is that a Flash web site will need to be extensively rewritten if there are any changes to be made, such as a new company logo. Also if you change web design company, the new company will not have the source Flash files, whereas with DHTML/AJAX the source and production files are the same, so you always have a copy.
Why should open-source be a requirement for your web site? Do you want to be stuck with the same web designer until you can afford a completely new web site built from the ground up?
As a web designer you may believe you protect your intellectual property by designing a site using technologies that hide the source files from end users and customers. Web design changes so quickly that by the time someone rips you off you will be producing sites that look different anyway, or will you, perhaps you should.