Hi Derek,
Only Gordon can answer your questions about TaskChain (knowing Gordon, I think you'll get an answer to all your questions) but I can say something about the look of Hot Potatoes exercises.
I agree they can look at bit dull "out of the box" but it's quite easy for non-techie people like me to modify them with very simple tweaks of the code. Martin Holmes and Stuart Arniel kindly explain how to do this: Hacking in Hot Potatoes: A little knowledge brings a lot of power and Stan Bogdanov has further tutorials" on his site for doing even more.
I don't pretend to rival Flash in flashiness, but I feel some of my exercises are reasonably attractive, for example these pronunciation exercises: Limericks.
Cheers,
Glenys
Or just this little demo :
_