I've used this method with some success. Not sure if it works with Flash. Works well with Quicktime based playback and causes very weird looping glitches with iOS builtin mp3 player.
This is exactly why MP3 is never used in this way. MP3 really is a very bad choice of format for what you are trying to do.
When I have produced audio for use in projects like this (I have provided audio for video and computer games in the past) the codec of choice has always been OGG format files.
I would basically discourage you from using MP3.
I also remember from my early years with the framework up until now, they never got ...