The Chumby app for Android is just the widget player - it currently does not include alarms or music, though that may change.
There are already dozens, if not hundreds of apps for Android that do music, including ones for all of the services we currently offer on our branded devices, so there was no point in reimplementing them.
Android natively supports the streaming of FLAC - but it's possible that the music player apps filter them out. One issue with streaming FLAC is that since the compression is relatively low compared to MP3, AAC, Ogg, etc, it consumes a *lot* of bandwidth, which is generally discouraged for mobile devices.
The Chumby app works fine in stock versions of Honeycomb, through the current MR2, but we have not tested it on a Revue with Honeycomb. It "works" on prior versions of Revue (jailbroken, of course), however, the Flash Player on the older Revue firmware *only* works in the built-in Chrome browser, not the WebKit control used by other applications, so widgets do not actually play.