Not a bad idea, but they would be pretty tiny <img src="/ubbthreads/images/graemlins/smile.gif" alt="" /> Speaking about Flags, It certainly would be nice if there were a couple of different colors you could choose. Then you could use one color for quest npc locations, vendors, trainers and such, and another color for areas you want to return to, and maybe another color for marking doors, stairs, teleporters, etc.
Since I try very hard not to use spoilers or maps I can easily put down 20 - 30 flags in an area, and then have to hunt through them all to find the one I am looking for.