Well, flash is a good and a bad thing. Bad because it is bugged as hell and tends to steal cpu power when emulators are running, good because you can run code inside the swf. In my themes I use as3 to load an external xml into the thing to show game's info (text or images), aeon nox has even weather forecast 😛
Anyway it seems that is possible to make cool thing with attract mode, I need to check it out.
HS seems can run a video and 2 1024x768 swf check it out, the background is a swf loading another swf as embedding a swf as background into the theme won't loop it.
Do those mp4 have alpha channel? What software are you using to make the videos?