Kdrobins,
Thanks for the compliments. I just started my new job last month and I have been extremely busy with that. Hopefully things will slow down in about a month.
The off-centered polygons for some nations is a bug, not a feature.

There is a placemark at the end of everything that lists out known bugs; however, I don't think that I added the reason why they were bugs. Most of these off-centered balloons are a result of a country covering an odd shaped geometry (islands are the big culprit). The way GE works for balloons is that it takes the extremes of eastings and northings and creates a point in the center. The basic example is Vietnam. Because of its cresent shape, the balloon is just west of Vietnam. For the US, some of the Aleutian Islands are actually in the eastern hemisphere; therefore, the average of its farthest east and farthest west grid is about 0 (-180 and +180). The solution is to place a <LookAt> field for each country that is incorrect. I just haven't had the time to do it.
The only reason that I used ImageShack instead of the flags from the CIA World Factbook was because I wanted to try using image hosting source. In the past I have had files end up invalid because the website I was referencing changed the name of their graphic. Then I had to go back and fix it. I just didn't want to have to deal with that. The CIA Factbook is probably the exception, because they are pretty strict in their naming conventions. (ie predictable). As far as I know, I don't think there is a problem with using their flags.
I usually try and put comments in my KML file in order to help other users figure out how it was done. I didn't with this one, but you can look at some of my earlier posts in the KML discussions forum. I am not territorial with my KMLs. I put them out there to help generate ideas. In fact most of my posts are just a compilation of several other people's ideas. So, feel free to modify and post as your own. Just reference people like James_Mcgill, Ink Polaroid and GlobalTrotter2 (the people who came up with the ideas).
Again, thanks for the compliments. Welcome to the BBS, and I look forward to some of the things you will produce.
p.s. I am adding my updated file. It is a work in progress, but I don't know when I will get to work on it. This includes Ink_Polaroid's CIA World Factbook KML. Also, it has been restructured into folders, to help with organization of other KMLs.