Compression setting effect file size as much as format does. Make sure you understand the required data rates and make the appropriate adjustments.
Also, you shouldn't be using a highly compressed source as the original for further compression. All of the compression artifacts in the WMV file will be treated as movement and your output will suffer greatly.
A little more details about your workflow would be helpful.
OK. This is what I am trying to do.
I have recorded a video using a screen recorder application called ZD Soft Recorder 4.0. It was originally recorded to demonstrate a problem I was having with a web application. Since then I have been asked to create a video that showcases the capabilities of the web application so I'm using this video as a test. The problem is that there is customer related data that is displayed in the video that I want to blur out. So I have used After Effects to accomplish this. Basically what I have done is copy the video to another layer, apply a blur and the mask out the bits that I want to appear as blurred on the original video. They want to make this available on the web. So I though flv is the way to go. You can look at the example I'm talking about at http://overview.buildingethics.com.au As you can see the quality is poor and the file size huge compared to the original.
It's important to understand that in After Effects (and in any other video processing application, for that matter) video gets decompressed in order to be played back and be used in any way. Because of this, the file size/data rate of the original video file is irrelevant. A smaller file size for the source doesn't mean a smaller file size for the output. So, if from you screen recording software you generate a great looking file that is uncompressed or nearly uncompressed, it will be a much better source for AE, and it won't affect the final file's data rate/file size at all. On the contrary, uncompressed material leads to much better compressed results in the end file.
The FLV size you're exporting is twice as big in terms of file size because the FLV encoding settings are targetting a bitrate which is twice as high. That's all. Depending on the total duration of your video file, 10 MBs may not be a problem at all, and it will give you much better quality... unless the source file was already compressed.
Not trying to confuse you further, but simply consider the difference in the compression algorithm as well. Even with identical data rates, there will always be differences. The tool you use may even use VBR compression, which on stuff with only few colors and many uniformly colored areas can indeed yield very small file sizes, at the cost of not supporting other features, like e.g. frames only being available after full download, because they need to be rebuild from differential data. FLV on the other hand is more aimed at balancing out different requirements like smooth streaming and thus uses a different scheme, so something is available at any time. Generally, though, these days I do not think that 10 MB or even more is too much of a problem. People who don't have the connection speed, wouldn't watch your 5MB WMV, either. What you can do, though, is to compress externally e.g. in Adobe Media Encoder. Due to its nature as a compositing program, AE always processes one frame at a time, which severely limits efficiency of temporal compression. AME and otehr tools are much more flexible in that regard and often produce better results with same settings.