I just noticed this and I don't think the behavior used to be this way. I have a .FLV video that has these specs:
Video: Flash Video 1 320x240 30fps [V: flv, yuv420p, 320x240]
Audio: MP3 44100Hz stereo 64kbps [A: mp3, 44100 Hz, stereo, 64 kb/s]
I have an .MP4 of the same video with these specs:
Video: MPEG4 Video (H264) 320x240 29.97fps 257kbps [V: h264 constrained baseline L1.3, yuv420p, 320x240, 257 kb/s]
Audio: AAC 44100Hz mono 71kbps [A: IsoMedia File Produced by Google, 5-11-2011 (aac lc, 44100 Hz, mono, 71 kb/s)]
The thing I will probably do is just dump all the Flash videos anyway so it will use HTML5. But, if I have the jwplayer set to the 360p size, shouldn't it be larger for the Flash one?