The way Skyfire works, is that it uses server-side compression for the websites, similarly to what Opera Mini does, but its main advantage is that it does so for videos too. Thus the problem with the lack of proper Flash support is taken care of for most situations. The videos then stream to your device in a more friendly format, that your phone or tablet supports.
Another great feature of Skyfire is that it can mask itself as a full desktop browser, so if you need a page in its full glory, instead of the mobile-optimized version, you are covered. It is also one of the fastest browsers of the bunch - its average loading speeds put it on top for loading uncached sites. The only catch is that all these features make it somewhat unstable, and we think that's why Apple brought it back to developers for some additional tweaks. We hope that this will get approved soon and we'll be on our merry way.