ok i just downloaded the orginal file from your site and the FLV, its a:

file= Wmv
codec = Windows Media Video V8
audio= Windows Media Audio 9 96 kbps, 48 kHz, stereo (A/V) 1-pass CBR
bitrate = 1.53 Mbps
video size = 512 x 384
Aspect ratio = 4:3

The FLV file is blured so its not the flash player and must be a problem when converted.

Do you have SSH access?...maybe try manually encoding it to FLV with different options to see if its better quaility?