In flash lingo aren't games just interactive movies? I remember being quite confused when I discovered I could play pirated flash games on my video player software.

I mean, to the extent that Tetris, Pacman, or Super Mario is an interactive movie, sure? I guess technically they're a series of animations which change (very quickly) when you press a button. But most people would call those games.

I mean that they are movies in terms of what Flash call movies. Flash covers a huge number of features (networking, interactivity, animation, etc.) I believe that Flash games are implemented with the functionalities intended for interactive movies.