I just did a firmware update to the Zi8 and it improves a few things. (especially the zoom, which is now smooth)
I think the Zi8 has the Flip on video specs, but I can't really say which one is better. I know the Zi8 has 720p 60fps which is really nice for action shots. And it does full 1080p (at 30fps), I don't believe the Flip HD does that yet. I got mine because you could hook up an external mic to it and at the time it seemed like the "best" pocket cam out there.
pd/teebird, firebird, cyclone, buzzz, roc, wizard