You need to remember that at the time HTML5 wasn't around so if a developer wanted something more "multimedia" then it meant resorting to Flash. This meant that Flash ads had a lot of annoying traits like audio effect which you wouldn't get with HTML+JPEG/GIF ads.

Plus even back then Flash had a tendency to grind modest hardware to a halt (particularly if you were running OS X or Linux).

So Flash definitely made ads worse. However whether you want to blame Flash or the developers for that is really just a philisophical question. But suffice to say the most annoying adverts around that time wouldn't have been possible without Flash.