Claus Wahlers just announced on the mailing list for FC64 that he's very close to having the display code working. Very exciting stuff! Darron's got a more in-depth post on the subject with Claus' preliminary screenshot.
The Commodore 64 in Flash, one step closer! article by Aral Balkan, unless otherwise expressly stated, is licensed under a Creative Commons Attribution-Noncommercial 2.0 UK: England License.
Update: Here's a link to a running sample. It's just the start screen for the moment (no keyboard input yet). It draws the screen at around frame 100.
The Commodore 64 in Flash, one step closer! article by Aral Balkan, unless otherwise expressly stated, is licensed under a Creative Commons Attribution-Noncommercial 2.0 UK: England License.

Don’t froget to test this with a *RELEASE* version of the Flash Player. The player that ships with Flex Builder is the Debug player.
To get the release player, visit: http://www.adobe.com/products/flashplayer/public_beta/
It’s like 4x faster. The debug player runs the .swf at ~17 frames per second. The release player runs it as ~63 frames per second. :-)
Neat, Darron — thanks for the tip! :)