It can do what Flash can do on an iPad. Sounds good to me.
HTML5 by itself cannot yet do everything that Flash has been able to do. It's getting closer, but a lot of the extra functionality, such as the WebSockets API, is still undergoing extensive revision on the W3C's drafting table, and support among most web browsers is still very fractured with some browsers (Firefox, Chrome) supporting the bleeding edge and turning off all support for older versions, and other browsers (IE, Safari) supporting only the older versions which are incompatible with the newer revisions and known to contain security oversights.
If HTML5 on the iPad is capable of replacing 100% of everything that Flash would otherwise have been able to do, then the iPad must have some proprietary extensions to HTML5 which make HTML5 good enough to be a Flash replacement. And if that is the case (if HTML5 has different capabilities on the iPad than on other platforms) then we've just thrust ourselves back into another case of a fractured web landscape, just as bad as Flash has proven to be.
This would be a fundamental roadblock to true universal web accessibility, which defeats the whole point of HTML5 standardization in the first place. For HTML5 to be a worthy Flash replacement, it must be capable of delivering the same experience on every platform.