First, Balsamiq has been around for awhile. I don't think that was the worst choice ever. In fact, it was probably the best decision to make it 1) work and 2) work and 3) work across browsers and 4) SHIP. OMG YouTube uses Flash, what are they thinking OH NOOOS.
Next, whether it works on an iPhone or Android is not necessarily the most important thing for that audience. It is a mockup/sketch application for user interfaces. Perhaps they will create a HTML5 version but I think the guy did a great job and made a good choice for his business. I first heard about it on, I think, the Startup Success podcast some years ago.
People are mainly using Balsamiq to create things. The iPad isn't typically used for content creation, but for content consumption. For a UI editor, drawing tool, etc. like Balsamiq you'd be more productive with a more precise pixel pusher like a mouse rather than a fat finger. Not to say that you can't do any prototype design, while laying around on your couch with an iPad -- just that beyond a few things when you get into the details it's not that great of a form factor.
Kind of a narrow view isn't it? People do use iPads for "content creation" (ask Harry McCracken) but even without disputing that, consider that Windows 8 Metro mode means no browser plug-ins. And that will definitely be used on devices with keyboards and pixel-precise input methods.
Strategically speaking it’s awkward because Flash is literally dead†, and unavailable on the most popular couch computer ever, the iPad.
What’s the UX look like for someone coming across one of these posts on their couch, now?
†Officially abandoned on mobile & Linux, as Adobe realigns Flash to niches like gaming