Adjust the wind strength. (8 is nice) Click on the "wind" button to initiate waving. Enjoy.
Update: I made some different flag overlays. They're in the sprites section. I did this a) because I was bored and b) because I'm fascinated with Vexillology. If you don't know what that means, go google it. And, as always, feel free to remix, follow and post ideas to improve.