Why would these games work on http://www.phpbbarcade.com
with IE8? Have you tried to play some games that begin with numbers there? I have not been able to make this error occur. Also that link you posted talks about validation issues, not problems loading the flash files. The arcade has been using swf object for a long time now without any issues.
If I would know, why, I could be on the same stage as God
Must be special setting on your web server, which probably not everyone has. I never realised that problem, as I'm using FF and not IE
I only can say, that they work fine with IE7, but not anymore with IE8 (at least for my site).