Things are a bit rosier with Adobe's pre-release of Flash Player 10.1. The Windows version has significant improvements, namely support for hardware-accelerated video decoding of h.264 video, but the Mac and Linux versions do not include support for this feature. As usual, Adobe blames Apple for "not being open enough" -- "Mac OS X does not expose access to the required APIs" according to Adobe -- but even without hardware-accelerated video decoding, this pre-release build of Flash boasts significant CPU load improvements over its predecessor.
Anandtech tested the performance improvement of the pre-release version of Flash Player with the following results:
I took the same Office clip I'd been using for all of the other tests and ran it on my Mac Pro at full screen (2560 x 1600). Using Activity Monitor I looked at the CPU utilization of the Flash Player plug-in. I compared both versions of Flash and saw a significant drop in CPU utilization:
Flash 10.0.32.18: 450%
Flash 10.1.51.45: 190%
Going from roughly 450% down to 190% (or a bit over 10% of total CPU utilization across 16 threads) made full-screen Hulu playable on my machine. In the past I always had to run it in a smaller window, but thanks to Flash 10.1 I don't have to any longer.
Since I'm in New Zealand, I don't have access to hulu videos (shakes fist in rage), so I wasn't able to precisely replicate Anandtech's results. I did test fullscreen video performance at TVNZ.com and YouTube both before and after upgrading to the pre-release build of Flash 10.1. While I didn't see the huge drop in processor load Anandtech did, Flash did indeed suck up far less CPU under 10.1 than under the previous build.
Test machine: Early 2008 MacBook Pro, 2.6 GHz Intel Core 2 Duo
Fullscreen YouTube video, Flash 10.0: 50%
Fullscreen YouTube video, Flash 10.1: 35%
Fullscreen TVNZ video, Flash 10.0: 110%
Fullscreen TVNZ video, Flash 10.1: 50%
Even for piddly YouTube videos, the drop in CPU utilization is pretty noticeable, and CPU load for TVNZ went down by more than half. I've got to admit, this is the first time in a long time that Flash has impressed me.
I don't know how crash-happy this build of Flash is compared to previous builds, and since it is a pre-release build, they most likely haven't shaken out all the bugs yet. So if stable Flash (an oxymoron if there ever was one) is critical to your workflow, upgrade at your own risk. If you roll with 64-bit Safari as your main browser in Snow Leopard, though, the risk is somewhat lessened -- Flash runs as its own process, so it won't bring Safari down with it if it crashes.