I really don’t have any other solution. You have it setup correctly. For some reason Flash just can’t play the stream. Not sure why. I might try following these instructions to turn on packet sorting and packet loss logging. Maybe you are getting severe packet loss.
http://community.wowza.com/t/-/51
If there is any way to make this camera available on the Internet so I can try it that might help? Be sure to setup a very, very low bitrate stream.
Charlie