I’ve been keeping my eye on the developments that Geoff Starnes (author of the SWFObject fix, which is what we currently use in products at PixelMill) and Bobby van der Sluis (author of UFO, another popular Flash embed fix) are making with SWFFix, which is now up to 0.3 alpha.
While SWFObject has been very useful for both providing alternative content and combating the IE “click to activate” message, it ultimately depends on Javascript being enabled for the Flash substitution to work properly. It’s very possible that there are people who have the proper Flash player plugin but who have Javscript disabled; those people wouldn’t be able to view the Flash that is substituted by Javascript.
If you want to try out the SWFFix code, visit the development blog and download the code and view documentation at Google Code. PixelMill will transition to SWFFix in future products once it is released.
You can read a thorough discussion about various ways to embed Flash into a web page, which leads to why Starnes and van der Sluis have started working on the SWFFix at A List Apart.