Excellent and thorough response. Thank you! So now that you brought up Flash I would have the exact same questions: Should I remove Flash 100% from my Mac? What is the best course of action on my Mac concerning all things Flash related?
If you can live without Flash, then you might as well remove it - as far as I have encountered, the main uses for Flash these days are:
a) Delivering videos
- this seems to be diminishing as more and more sites switch to standard HTML5 delivered videos
b) Small games played inside the browser
- this will realistically stay with us for quite some time
c) Advertising
- not having Flash, or at least not enabled, can be a good thing here
Personally, I think the only justifiable use of Flash is for small in-browser games, and if you have kids, this may be unavoidable (think sites like Miniclip, Tanki, etc. ;-)
For videos, more and more sites don't need it anymore. I have also read that disabling it may give you videos of better quality, e.g. from YouTube.
If you're not sure whether you can do without Flash, then again my recommendation would be in Safari's Security preferences (Internet plug-ins website settings) to set Flash to "Block" for all websites, and then enable if for the websites where you find you need it.
It not only makes your system more secure, but also helps performance.