Its great that Apple are relaxing their policies. I still don't know why Apple would want to stop 3rd party applications competing with their own... pretty damned weird. Safari is a good browser... but not the greatest.
Apple should now relax other policies such as restrictions on background applications etc.
When it comes to other web components, Apple should allow Flash, and other media players, so users can enjoy the full internet experience. If you don't like these, then don't install them, and life will go on as before!
These people complaining about Flash, I'm betting that these people don't know how widely it is used, some websites use it for navigation menus, or say, a photo gallery - which don't appear as being Flash driven at all.