Can you fly while entangled?
Yes, but it would require some Fly checks to stay flying while moving half speed, which in turn would suffer from the penalty to Dex imposed by being entangled. If the entangling object is somehow anchored to something, it would prevent the flying creature from moving, but it's hard to imagine what would entangle a flying creature and also be anchored. I guess a very strong PC could net a low-flying beastie to bring it down.
I'm a fan of setting flying creatures on fire, since they're even less likely to spend a full-round action to put themselves out than most things are. I have also always wanted to see a flying spellcaster brought down by a monk who spends a ki point to jump up and grapple them, then proceeds to "pin" them in midair, making it so fly checks are impossible and bringing them both plummeting to earth. Bonus points if it's positioned such that the slow fall ability negates the monk's falling damage. Another cute trick is to ready an action to conjure a wall (ice, stone, iron, or force) just in front of a flyer as it swoops low to attack. This works best with dragons and other things with low maneuverability that really are likely to crash. Last but not least, blinding a flying creature is useful for obvious reasons and for the potentially less obvious reason that, like entangling, it will force fly checks for moving half speed or less.