Is there anyway to export to Flash and allow masking without losing much quality and keeping the file size down? Is there just a better way to set up a character's face to allow for pupil movement and blinking?
I was thinking doing the full document size export but all those images would run the file size waaaay up. Importing a video does the same and the movie loses quality, too.
File size for an exported swf from AS isn't going to have much to do with masking. The file sizes are big due to support of Flash features in AS.
What makes the file size huge is using flexible bone binding or point motion. AS can't do the same type of shape tweening that Flash does and so it exports a unique image for each frame.
The red "dot" on the layer determines if that layer is "optimized" for Flash. Basically "puppet" animation using vectors bound to bones or layer rotation/translation are the best bet to keep file size down.