I could have sworn I read somewhere they meant "proper" flying. But I think you're right Tygerwoody.
The Vanguard game engine is being designed to allow for flying (some screenshots and last year's E3 in-game movie show this, and some of you who have had the game demo'd to you have probably seen us use GM powers and then fly high up into the air -- having a true seamless world really helps with this too, btw). Mobs already fly and can path through the air as well as on land and under water.
That said, fully supporting true flying involves a lot of planing and additional functionality and so it's unlikely we'll support true flying (as opposed to levitation, which has been in many games, back to EQ 1 and before that) at launch. Hopefully in an expansion we can really explore additional modes of travel like this. Also, griffon rides that are on tracks like WoW and EQ 2 have wouldn't be hard to implement.
Anyway, just want to be up front about this and manage expectations. Were we to have, for example, fly carpets, they would levitate, not truly fly.
Oh well. It was a cool thought. Maybe in an expansion.