I'm of the opinion that it's not worth sweating over.
Validation itself doesn't guarantee consistant display.
I'm inclined to allow invalid, but effective flash markup to stay in and live with it, knowing that the rest of the markup will still be read, understood and displayed according to the strict model.
So long as the invalid tags (and their attributes) are nested correctly they won't (read: shouldn't) 'break' the site/layout.
I'm happy to grin and bear it until such time as W3C catch up with their tail and get object placement sorted.