I think that the question of which is a better too for character animation simply depends on which application you're more comfortable with.
That said, if you do decide to use After Effects, I recommend against exporting as FLV for further use in Flash. That is an old format that has been surpassed by F4V and other H.264 containers.
I'm kinda suprised to hear that flv isn't a good format for further use in Flash. (It's been working well for me so far.) What problem might I run into by using FLVs instead of F4Vs? I need to 'see thru' the movie's background to the Flash stage and therefore I've been using the 'FLV with Alpha' option in the AE export. Can I get that with FV4 other H.264 containers?
Ah, that is the one reason to still use FLV files: alpha channels.