Ok, Director and Flash are almost the same thing. They are "Shockwave" Plugins.
However... they are two TOTALLY different plugins, so I don't know why Macromedia created such confusion by putting everything under "Shockwave". In fact, I think they stopped doing that.
The Director plugin (free) plays director AND flash movies. It is about 8 MB. It takes several minutes to install, or more. The flash plugin (free) plays only flash movies. It's under 1 MB. It takes about FIVE SECONDS to install on most PCs.
So... 99% of the web can see at least Flash 4 content. Around 90% can see Flash 5, and the number that can see Flash MX (Flash 6 content) is always growing bigger. Flash is ubiquitous which means basically EVERYONE can see it.
Director, on the other hand, was never meant to be a web-based plugin. There is a whole web site for director, and tons of online games done in Director, but nowhere NEAR as many people have the director plugin. That's' why Director is best done on CD-ROMs. Why?....
Both Flash and Director can be saved as executable files (programs). (EXE files on PC, Application Programs on Mac.) When saved that way, your file becomes around 1 MB bigger, and you don't need ANY plugin or anything to play the movie. You just double click.
Both Flash and Director can both be used to make an animated super cool web site, and BOTH can be used to make an interactive CD-ROM that launches in beautiful full screen.
Flash has always been much more limited than Director. Director has always been your "do anything" program, while flash has been your "vector animation and music" program, since the plugin / player are so small.
Nowadays, Flash MX is so advanced, it almost makes Director obsolete. However, Director still has a few cool things you could never do in Flash. Here's the differences:
Director:
1) Can make realtime 3D worlds. (Like a playstation game or something)
2) Can embed other filetypes WITHIN your movie. (HTML, PDF, MPG, MOV, etc. etc.)
3) People can make "XTRAS" for director which let you embed anything in the world. Someone could make an "XTRA" for director that lets you embed an Appleworks file, if you wanted, I guess.
4) The programming language is Lingo, which has more syntax than Actionscript (which is Flash's programming language)
Flash MX:
1) Nowadays, its programming language (Actionscript) is completely object oriented and you can do ANYTHING with it (except the things listed above for Director)
2) Works best with Vector graphics. (Director works better with sprites, but Director can use Flash movies whenever it wants, too.)
3) Flash MX can now import movie files and it has its own video format. It rocks! You no longer need Director to embed videos in your movies!!!
4) Can't embed anything within your movies except other Flash files, and now with Flash MX, you can import JPG files too. (I'm talking about run-time here, of course.)
Some other differences:
Flash runs slow as hell on mac. It's one of a macs biggest problems. I bought a PC just to watch flash web sites (and play Counterstrike). Director movies run JUST FINE on mac. So there's something wrong with Macromedia's brain. What's wrong with your brain???
Director can zoom in on sprites much better than flash. When flash zooms in (even by 1%) on a sprite it gets all choppy and crappy looking. If you force your flash movie to never grow or shrink and always stay at 100%, it's not a problem. (I heard Macromedia is working on this problem as you read this.)
If you want to make a CD-ROM that autolaunches, runs full screen, has a music track, has videos, and a very advanced interactive interface, you can now use Flash MX or Director. For this purpose YOU SHOULD ONLY USE FLASH! Because you could port your CD-ROM to a web site very easily! It's already Flash files!
Now... if you need to add embedded PDF files, or programs that install files directly to your computer, or run a 3D world or game, then you need Director.
If the above things are not on your required list of functionality on a CD-ROM.... USE FLASH PEOPLE!!!!! (or iShell if you don't do Flash.)
Director, nowadays is basically only 1 thing:
3D program that can embed other filetypes with a bit more robust language (scripting) system.
Flash MX is now everything Director is, just no 3D realtime programming and a little bit less robust language (Actionscript) which is SUPER AWESOME these days.
Also, some math geniuses have made their own realtime 3D worlds right in flash. (Like, built from scratch... EVERYTHING). It's insane. They are simple 3D worlds, like a spinning cube, or simple 3D scene, but it's insane. For pre-built 3D worlds, you can use something like 3D Studio Max and export your animation to vector graphics for Flash and voila, 3D animation in Flash!
So for 3D purposes, Director is only needed for something really good, on the level of a playstation game, in real time (programmable).
There you go, sorry for the long post.
-Carlos-