I am using the below URL to play videos in my site
http://releases.flowplayer.org/swf/flowplayer-3.2.1.swf
Is it free and legal to use it in production.
Yes i have gone through this site
And find out that It can use under The GNU General Public License (GNU is a free, copyleft license for software and other kinds of works). And it can hosted it in live server but the copy right protected and the logo will always be there in the player. If you want to customize the logo you have to buy it from the above site.