Popup little settings window

That's a great question for Mozilla.  The bugs linked in the threads are things you could subscribe to updates for, and/or may already have information about workarounds or when a fix would land.

Managing security dialogs in the context of Flash Player is tricky, because as a browser plug-in, there's not guarantee that the pixels that we're drawing are the top-most ones.  We have to guard against the possibility that someone has obscured our security dialogs in a way that might trick you into authorizing behavior without your knowledge: Clickjacking - Wikipedia

Unfortunately, there's not really a perfect way to do that, and we err on the "too restrictive" side.  What we do is basically take a screenshot of the area where the dialog appears, compare it to what we *think* should be there, and if they don't match, we don't accept your click.  This gets really problematic when the dialog pops up over stuff that moves, like video and animation.

The ideal solution would be to move that permission dialog into the browser (which could authoritatively present a security dialog), but that would require getting all of the worlds' browsers to build new facilities to handle that, and it's just not going to happen at this point.

So, the easiest way to deal with it is to just prevent the dialog from popping in the first place.  You can do that by authorizing storage for either all sites or specific sites, by going to Control Panel > Flash Player > Storage, and choosing Allow sites to store information on this computer.  For Chrome, this is a little different, but you can do it by right-clicking on some Flash content, choosing Global Settings, and making your storage changes there.

Hope that helps!