Is Flash available in iPhone 3GS?

No, the iPhone does not support Flash, and will not until Adobe develops an appropriate plug-in.

An officially unlocked iPhone (bought from a carrier that unlocks it for you) can have it's OS updated just like any iPhone. Jailbreaking/hacking/unofficially-unlocking the iPhone violates Apple's EULA, voids your warranty, and is not an appropriate topic for the Apple Discussions.

2Chuck wrote:
Does anyone know for sure an unlocked iPhone 3gs will not be able to update its operating system via Apple?

The US iPhone is not sold as unlocked so as long as you leave it the way it is, you can update the phone.