Hi Kyle,
Which version of Moodle are you using? If it's 1.8 or 1.9, most of the hard work has already been done for you: http://code.google.com/p/swf-activity-module/
It includes an AMFPHP (Flash Remoting) API that exchanges data between Moodle's back end and Flash clients. I have some demos up and running here: http://moodle.matbury.com/course/view.php?id=17 The Word Search application can request its vocabulary data from instances of the Glossary module (experimental). It's very difficult to retrieve the correct IDs for Glossary module instances, so I'll have to develop some kind of interface app that'll list all the Glossary instances on a course with their IDs. It also accepts vocabulary data as XML and FlashVars via the SWF Activity Module instance configuration form.
I'm currently working on an application that queries Forum discussion threads and performs analyses of word frequency, similar to tag clouds, but also allows you to supply XML files of words to omit from the analyses, such as grammatical words (non-content words = a, an, the, then, that, which, be, etc.) so that only content words are counted. It should give learners and teachers an overview of themes running through discussions at a glance. The same can easily be done with chat.
It's also possible to generate games and tests from Glossary entries, so that learners can create glossaries and then use them to generate revision activities.
If you're an intermediate or above Actionscript developer, you could try experimenting with the Snapshot script: http://code.google.com/p/swf-activity-module/wiki/Snapshot There's an example concept map application (open source) that you're free to experiment with, which saves screenshots of Flash apps and records them to the course files directory and links/embeds them in a Moodle grade book entry. I've also got this working for saving short WAV audio recordings from the user's microphone (experimental) but this duplicates what the NanoGong Java app plugin for the Assignment module does. The NanoGong version records audio to MP3 and is much better!
As you can see, there are a variety of ways to use user generated content to generate further activities for revision/review, reflection, consolidation, etc. I think the limit is our imaginations.
BTW, because of Moodle 2.x's new file API, many of these features are impossible to implement without using an externally managed file repository.
I hope this helps! 
