Show Keyboard & Character Viewer in Menu Bar

If you are talking about the Character Palette, you can access it from most applications by going to the Edit menu and selecting "Special Characters..."

Alternately, you can go to Languages & Text and under the Input Menu tab, select Character Palette in the list and make sure and Select "Show input menu in menu bar" at the bottom of the window. Now you can open the character palette by clicking on the flag on your menu bar and selecting Show Character Palette.

I checked the box to do this in the system preferences, but it doesn't show up, and when I go back to system preferences, keyboard, the box is unchecked. How can I accomplish this?

I think you need to check the box "Show Input Menu in Finder" in system prefs/language & text/input sources. The box in system prefs/keyboard makes those items appear in the "flag" menu, and if the latter is not activated, it can't work.

I think I finally have it up there, but it's not a "flag." It looks like the icon of the character palette.

It will become a flag if you enable more than one keyboard language.