Doesn't it work like 'click to flash' i.e. each element activates when clicked on? I haven't tried but I assumed it did.

It does, but at the page level. If a page has seven flash elements, once you activate any of them it activates all of them (as the activation is of the plug-in rather than the instance). I suspect this was by design, as the thought would be "make compelling flash content and then we'll also get them with the flash ads".