Yeah its reduced.
Its also reduced by 20% by Shield Oath.
However Flash does get the 20% buff from Maim...
I guess the way Flash "works" - going off the the data from the enmity meter - is that it is calculated "like" damage, but with zero variance (no +-5% range, always the same value for a given set of stats), and whatever "damage" it would have done is multiplied by zero at the end, but hate is still applied.
So it suffers from general (player based) output reducing abilities, IE Shield Oath, Defiance, Determination Down.
It also benefits from player based buffs, though really just Maim.
And it does not seem to be affected by mob mitigation abilities. For example, you can Flash a mob that has Sentinel on it, like the Gigas guys near the entrance to CT/ST, and it will generate the same amount of threat whether they have Sentinel on or not.